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oV' 



A HISTORY OF PUBLIC PERMA- 
NENT COMMON SCHOOL FUNDS 
IN THE UNITED STATES, 1795-1905 



BY 

FLETCHER HARPER SWIFT, Ph. D. (Columbia) 

Professor of Education, University of Minnesota 




NEW YORK 

HENRY HOLT AND COMPANY 
1911 






Copyright, igii, 

BY 

HENRY HOLT AND COMPANY 






!C!.A2924?0 



PREFACE 

The existence to-day of public schools in most of our states 
may be said to be due directly, though of course by no means 
solely, to vast endowment funds provided by previous genera- 
tions. In view of the part these funds have played in nearly 
every state, it is surprising that they have received so Little atten- 
tion from historians. The two most widely known histories of 
education in the United States, Boone's and Dexter's, give almost 
no information regarding them. Boone Hmits his discussion to 

.out seven pages and Dexter, his to two pages. 

State histories of education are equally disappointing to one 
seeking information upon this topic. Wickersham's History of 
Education in Pennsylvania, one of the largest and most compre- 
hensive of state histories of education, contains no organized 
statement regarding the common school fund of Pennsylvania 
estabKshed in 1831. References to the fund are made here and 
there, but more space is given to describing the domestic sur- 
roundings of various prominent schoolmen than is given to this 
fund. It is not included in the index, a fact which further empha- 
sizes the small place it occupies in the work. No doubt one of 
the causes for the silence of the historians is the difl&culty of secur- 
ing reliable information respecting the public permanent common 
school funds. This difficulty is discussed somewhat fully in 
Chapter One. The present volume is the first attempt to give a 
comprehensive account of these funds and their influence. Part 
One, designed for the general reader, is devoted to a broad survey 
of the origin, management, loss, and effects of the public perma- 
nent common school funds. Part Two is designed primarily for 
reference. It contains a summary of the origin, condition in the 
year 1905, and administration of the public permanent common 



IV PREFACE 

school fund or funds of each state and territory, arranged accord- 
ing to the alphabetical order of states. 

\ The present work was begun in 1902. No effort has been 
spared to make it accurate. The original documents have been 
consulted in every case where possible. Furthermore, every 
account in Part Two save that of Pennsylvania has been sub- 
mitted to the state superintendent of public instruction or some 
other state ofl&cial for reading and criticism. In some cases the 
help given has been most valuable. During the six years occupied 
in completing this work correspondence has been carried on with 
ofhcials in every state. It was hoped in the beginning that this 
correspondence and the data returned with it might be added as 
an appendix, but this has proved impracticable. Into an account 
as comprehensive as this some errors will almost inevitably creep, 
and the author will be most grateful to anyone who will call his 
attention to such. No one can be more aware than the author of 
the importance of certain topics omitted. Several topics which 
it was designed to include have been excluded, owing to the 
limits of space set by considerations respecting publication. 

It has proved necessary to omit from publication what was 
originally designed to be Part Three. This part contained a 
detailed account of the history of the funds in six t5^ical states : — 
Connecticut, New York, Massachusetts, Maine, Florida, and 
Indiana. These accounts were most important as intensive 
studies to the student of American educational or economic his- 
tory, and served as a basis for Part One. The more important 
Tables included in Part Three have been added in an Appendix. 

To one who has attempted to gather data covering a large 
territory no explanation will be necessary as to why the accounts 
in Part Two are not brought down to the year 19 10. Even the 
federal authorities are frequently unable to get data from states, 
and it is needless to say that the individual and obscure seeker 
after statistics encounters many greater difficulties. Certain 
states must be written to a dozen times before any response is 
received and then the data is incomplete and incorrect. The 
laws and regulations concerning the administration of the funds 



PREFACE V 

in most states have changed Kttle since 1905. To attempt to 
revise these individual accounts would be to postpone indefinitely 
the pubUcation of a work already too long delayed. Moreover, 
any permanent value of such a work as this must lie chiefly in 
the account it gives of the origin and history of the funds, as 
data for any year would speedily pass out of date. 

The foot-notes in each part are numbered continuously. 
Within the same series of foot-notes where the number of a foot- 
note is repeated, the foot-note itself is not. 

The author wishes to express his most sincere thanks to Pro- 
fessor Paul Monroe and to Professor Edward L. Thorndike of 
Teachers College, Columbia University; to Professor Monroe 
who suggested the subject treated in the following pages and 
under whose guidance the beginning of this study was conducted; 
and to Professor Thorndike who, together with Professor Monroe, 
reviewed the manuscript and made many practical and valuable 
suggestions. To the superintendents of schools and other state 
ofi&cers from CaHfornia to Maine most grateful acknowledgments 
are made for the courtesy, patience, and invaluable assistance 
they extended. 

F. H. S. 
Untv^ersity of Minnesota, 

Minneapolis, Minn. 
September, 1910. 



v\m^ 



CONTENTS 



PART I 

ORIGIN, MANAGEMENT, LOSS AND INFLUENCE OF PUBLIC 
PERMANENT COMMON SCHOOL FUNDS 

Chapter Page 

I. Introduction. Permanent School Funds and the Rise of Free 
Schools. Present Condition and Importance of Permanent 

Funds 3 

11. Early Sources or School Support and Evolution of Pub- 
lic Permanent School Funds 23 

III. Federal Sources of Permanent Common School Funds . 39 

IV. State Sources of School Funds and the Creation of Per- 
manent Common Funds 81 

[anagement of Public Permanent Common School Funds 107 

VI. Loss of Public Permanent Common School Funds . . 129 
VHj^ Purpose and Effects of Public Permanent Common School 

Funds 160 

PART II 

PUBLIC PERMANENT COMMON SCHOOL FUNDS AND LANDS IN 

THE STATES. A SUMMARY OF THE ORIGIN, PRESENT 

CONDITION, AND ADMINISTRATION OF THE 

FUND IN EACH STATE 

VIII. Alabama. Sixteenth Section Fund. Valueless Sixteenth Sec- 
tion Fund. School Indemnity Land Fund. Surplus 

Revenue Fund 207 

rx. Alaska 213 

X. Arizona 214 

XL Arkansas. Common School Fund. Permanent School Fund. 

Sixteenth Section Fund. Surplus Revenue Fund . . 216 
XII. California. State School Fund. Township Funds . . . 221 

XIII. Colorado. Public School Fund 226 

XIV. Connecticut. School Fund. Town Deposit or Surplus 

Revenue Fund 22S 

XV. Delaware. Public School Fund. Surplus Revenue Fund 238 

XVI. District of Columbia. Lottery Fund 242 

XVII. Florida. State School Fund. Township Funds .... 243 

vii 



VIU 



CONTENTS 



Page 
XVIII. Georgia. Academy Fund. Free School Fund. Poor Fund. 

School Fund. Surplus Revenue Fund 247 

XIX, Idaho. Public School Fund 251 

XX. Illinois. Township Fund. School Fund Proper. Surplus 

Revenue Fund. The County School Fund 254 

XXI. Indian Teemtory 259 

XXII. Indiana. Bank Tax Fund. Common School Fund. Con- 
gressional Township Fimd. County Seminary Fimd. 
Delinquent Tax Fund. Saline Fund. Sinking Fimd. 

Surplus Revenue Ftmd 260 

XXIII. Iowa. Permanent School Fund • . 268 

XXIV. Kansas. State Permanent School Fund 271 

XXV. Kentucky. Common School Fund. Literary Fund Surplus 

Revenue Fund ... 275 

XXVI. LoxnsiANA. Free School Fund. Perpetual School Fund. Sur- 
plus Revenue Fund 279 

XXVII. Maine. Permanent School Fund. School Taxation. Town, 

Ministerial and School Funds 283 

XXVIII. Maryland. Free School Fund. Surplus Revenue Fund . . 296 

XXIX. Massachusetts. Massachusetts School Fimd 299 

XXX. Michigan. Primary School Fund. Swamp Land Fund . . 312 

XXXI. Minnesota. Permanent School Fund. Swamp Land Fund. 316 
XXXII. Missouri. County Public School Fund. Public School Fund . 

Special District Fund. Township School Fund . . . 321 

XXXIII. Mississippi. Chocktaw or Sixteenth Section Fimd. Chick- 

asaw Fund 325 

XXXIV. Montana. PubHc School or State School Fund 329 

XXXV. Nebraska. Permanent School Fund 332 

XXXVI. Nevada. State School Fund 335 

XXXVII. New Hampshire. Common School or Institute Fund. Lit- 
erary Fund. Surplus Revenue Fimd 338 

XXXVIII. New Jersey. The New Jersey Permanent School or State 

School Fund. Surplus Revenue Fund 342 

XXXIX. New Mexico. Permanent Fund 347 

XL. New York. Common School Fund. Literature Fund. Town 

Funds. United States Deposit Fund 349 

XLI. North Carolina. Literary Fund 361 

XLII. North Dakota. Permanent School Fund 365 

XLIII. Ohio. Irreducible State Debt or Common School Fund . . 368 

XLIV. Oklahoma 378 

XLV. Oregon. Common School Fimd 380 

XL VI. Pennsylvania. Common School Fimd 383 

XL VII. Rhode Island. Permanent School Fund 387 

XL VIII. South Carolina. Permanent School Fund 389 

XLIX. South Dakota. Permanent School Fund 391 

L. Tennessee. Common School Fund. Permanent School Fund 394 



CONTENTS IX 

Page 

LI. Texas. County School Funds. Permanent School Funds 400 

LII. Utah. State School Fund 406 

LIII. Vermont. Huntington Fund. Permanent Public School 
Fund. Spanish War Claims Fund. United States De- 
posit Fund 408 

LIV. Virginia. Literary Fimd • • . 420 

LV. Washington. Common or Permanent School Fimd .... 423 

LVI. West Virginia. Irreducible Fund or School Fund .... 426 

LVII. Wisconsin. School Fund 429 

LVIII. Wyoming. Common School Permanent Fund 434 

Appendix "A." Tables relating to the History of Permanent Public Com- 
mon School Funds. Revenues and Expenditures in Connecticut, Florida, 

Indiana, Maine, Massachusetts and New York 437 

Bibliography. General 457 

Bibliography. Arranged by States 460 

Index 469 



PART I 

ORIGIN, MANAGEMENT, LOSS, AND INFLUENCE OF 
PERMANENT COMMON SCHOOL FUNDS 



CHAPTER I 

INTRODUCTION 

RELATION OF PERMANENT SCHOOL FUNDS TO THE RISE OF FREE 
SCHOOLS — PRESENT CONDITION AND IMPORTANCE OF PERMA- 
NENT FUNDS 

The existence of free schools in the United States is so universally 
accepted to-day that the period of indifference, struggle, and hard- 
ship through which they passed and out of which 

Early Opposition ^ ® . . 

to Principles of they arosc is well-nigh forgotten. Schools were 
free in some states, such as Maine,^ Wisconsin,^ 
Kansas,^ and West Virginia,"* from the time of their admission into 
the Union. In others, such as Massachusetts, Connecticut, New 
York, Pennsylvania, Arkansas, Ohio, and Indiana, a large part of 
the support for public schools was drawn from pupils' tuition fees, 
known as rate bills. 

That the responsibility of educating the child rests upon the 
state and not alone upon the parent or guardian, that the state or 
community has a right to tax the property of all its members, 
whether or not they have children attending the schools, are prin- 
ciples of education which have won acceptance among us gradually 
and in the face of bitter opposition. In many instances the only 
right recognized as belonging to the state was the right to grant the 
townships permission to tax themselves. And only after permis- 
sive taxation had existed for some time was it possible to enact 
compulsory taxation for schools. For example, in Massachusetts 
permissive taxation had existed from 1647,^ but it was not until 

1 Constitution of Maine, 1820, Art. VIII. 

2 Constitution of Wisconsin, 1848, Art. X, Sees. 3, 4. 

3 Letter, Apr. 18, 1868, from P. McVicar, Kansas Supt. Public Instruction, in 
Report of Connecticut Board of Education, 1868, p. 54. 

4 Constitution of West Virginia, 1863, Art. X, Sec. 2. 

5 Mass. Coll. Records, Vol. II, p. 203. 

3 



4 PERMANENT COMMON SCHOOL FUNDS 

1827 that it became compulsory. In that year towns were author- 
ized and empowered as before, but now for the first time directed 
to raise by town tax the money necessary to maintain such schools 
as the law required.^ 

The indifference existing in certain states during the first half 
of the nineteenth century toward establishing free schools for the 
masses may be seen in the failure of such states as Florida and 
Georgia to use lands or funds available for such purpose. Upon 
her admission into the Union, 1845, Florida received from the 
United States Government section numbered sixteen in each town- 
ship, amounting to over one million (1,053,653) acres.^ At 
first these lands were regarded as belonging to the township in 
which they lay, but as far as can be learned only one township 
ever attempted to make use of its school lands,^ so that three years 
later the state passed an act directing the lands to be sold and the 
proceeds merged in a permanent state school fund.^ 

Article fifty-four of the constitution of Georgia, 1777, provided 
that " Schools supported at the general expense of the State should 
be established in each county," and in 1783 the governor was 
empowered to grant one thousand acres of land for the establish- 
ment of such free schools.^° Subsequent pro\isions and appro- 
priations were made, so that by 1836 an annual revenue of about 
forty thousand dollars w^as available for free schools. But in 1845 
only fifty-three out of ninety-three counties applied for their share.^^ 
Up to i860 the income was often diverted from its lawful use, and 
often rejected with contempt owing to the stigma of the badge of 
pauperism attached to receiving it.^- An attitude similar to this 
prevailed to a greater or less extent throughout the United States. 

6 Laws of Mass., 1S27, Chap. 143, Sec. 4. 

7 Table of Land Grants, Report U. S. Commissioner of Education, 1892-93, 
II, p. 1283. 

8 U. S. Bureau of Education, Circular of Information, No. 7, 1S88, p. 20, note 2. 

9 Laws of Florida, Fourth Session, 1S48-49, Chaps. 230-231. 

10 Constitution of Georgia, 1777, Art. 54; Hinsdale, B. A., Documents Illustrative 
of American Educational History, p. 13 14. 

11 U. S. Bureau of Education, Circular of Information, No. 4, 1S8S, p. 27. 

12 Ibid., p. 26. 



INTRODUCTION 5 

Private schools and academies increased in number and were 
attended by the well-to-do; the free public school being regarded 
as a charity or pauper school. It is said that in 1834 Massachusetts 
alone contained nine hundred and fifty private schools and acad- 
emies.^^ 

Despite these early harassing conditions, by the year 1870 a 
system of free schools had become established in practically every 
Existence of State State in the Union. In almost every state these 
Sysreins Due to systems had been begotten and nurtured by one 
Perman^en/ School °^* ^^rc general public permanent common school 
^^^^^ funds; by which term is meant a fund the principal 

of which the state constitution or laws provide shall be kept per- 
manently invested, and whose income alone, therefore, can be used 
for the support of common schools. The principal of the fund 
may be held by the state, as in Connecticut and Minnesota, or di- 
vided among and intrusted to the counties, towns, cities, and vil- 
lages, as in Indiana and Missouri. These general permanent pub- 
lic funds differ from the permanent local funds in that they owe 
their origin to an act or grant which made provision for the entire 
state or territory or for the component units of the same, town- 
ships or counties, and did not originate in some act, grant, be- 
quest, or gift affecting one or only a limited number of communi- 
ties within the state. Many townships and cities do possess funds 
of this strictly local type, but the present work does not attempt to 
include such, except in so far as is necessary in showing the evolu- 
tion of general permanent state or public funds. 

It is difficult to ascertain the true condition of the permanent 
funds of many states. In some it would appear that officers 
Real Condition of immediately related to these funds are ignorant, 
Fund^^f'ten '^ °° ^o^ Only of their history, but also of their present 
Unknown condition. The data given in both state and 

federal reports are sometimes incorrect, frequently misleading. 
Thus the federal reports for 1905 and 1906 both indicate that 

13 Massachusetts and Its Early History, Lowell Institute Lectures, pp. 4S6-487, 
published by the society, 1869; Boston, Mass., U. S. Commissioner of Education, 
Report, 1S92-93, Vol. II, 1237. 



6 PERMANENT COMMON SCHOOL FUNDS 

Delaware derived no common school revenue from any permanent 
fund/** though crediting her with a permanent fund of $350,000;^*^ 
whereas Delaware in reality possesses a permanent common school 
fund known officially as the Public School Fund, having an invested 
principal in 1905-06 of $938,097,^^ yielding an annual revenue of 
$34>303-77>^^ which is approximately ten and eight-tenths per cent 
of the total common school revenue for 1905 * 

Further evidence of lack of accurate information and of the 
difficulty of securing correct data is shown by the two following 
conflicting statements, the first taken from an unpublished type- 
written account furnished by the New York State Department of 
Finance, December 23, 1906, the second from the report of the 
controller: 

(i) "The U. S. Deposit Fund is invested in municipal securities and in 
mortgages. . . . The fund has been kept inviolably intact." 

(2) "A liberal estimate of the present worth of the $1,442,837.91 [of the 
U. S. Deposit Fund] held by the loan commissioners of the entire state will not 
exceed $1,000,000 of sure assets. The losses suffered by the principal .... 
from April 4, 1837, to September 30, 1905, amount to $333,862.17." is 

Table VII, pp. 20, 21, attempts to show the real condition of the 

permanent common school fund in each state as far as it has been 

possible to ascertain it. It will be seen that the 

Funds Classified: ^ , r n n • i r i i • i 

Intact Funds, funds fall naturally mto two classes, lunds which 

are intact and credit funds. Intact funds repre- 
sent a real investment. Connecticut, Massachusetts, Maryland, 
Oregon, South Dakota, Utah, and Wyoming are among the states 
which appear to have kept their funds intact. There are three 
classes or types of credit funds. The first class includes funds the 
principal of which has been lost or diverted outright, but which is 

* For source of data and fuller statement on this point consult the account given 
in Part II. 

1* Report U. S. Commissioner of Education, 1905, Vol. I, 410; Ibid., 1906, Vol. I, 
306 (data for 1904-05). 

15 Ibid., 1905, Vol. I, 419; 1906, Vol. I, 315 (data for 1896-97). 

16 Delaware Treasurer's Report, 1905, P- 20. 

17 Ibid., p. 23. 

18 New York Comptroller, Report 1906, p. 280. 



INTRODUCTION 



7 



recognized by the state as a permanent debt on which the state 
must pay an annual revenue, the rate of interest or amount being 
fixed by law. The funds of Tennessee, Kentucky, and the greater 
portion of that of Louisiana are examples of this class. The 
second type of credit fund is one concerning which the laws provide 
that the state may expend the proceeds belonging to the principal 
as fast as they are paid into the treasury, credit the same to the 
fund, and pay interest on the account thus established. Such 
funds might be called permanent state accounts for common 
schools. Maine, Michigan, and Ohio have pursued this policy. 
A third class of funds which are in part practically credit funds are 
funds whose moneys have been borrowed by the state and which 
to-day are represented by state bonds, which will in all probability 
never be redeemed, and which constitute what is practically a state 
debt. It will be recognized that this third method of employing the 
moneys belonging to the principal of the permanent fund is differ- 
ent from using them to purchase state bonds in the open market. 
The fund of California is very largely a credit fund of this third 
class. In at least sixteen of the states the permanent common 
school funds are entirely or in part credit funds. Table I, see 
p. 8, shows for each fund in certain states: (i) the amount of the 
principal intact, (2) the amount which is a credit fund (1905). 

In federal and in most state reports these credit funds are re- 
Misconception ported from year to year without comment as per- 
ConditioiT of Funds manent funds, so that many states appear to have 
and by Lax Use^of permanent productive sources of revenue for 
"^^^^^ common schools which, in reality, have nothing 

save an additional source of taxation. Furthermore, the lack of 
uniformity in the use of the terms "school fund" and "common 
school fund," which are used in some states to designate permanent 
funds and in other states to designate annual school revenue 
derived from a variety of sources, is another misleading factor 
which must be reckoned with, and which makes it necessary to 
devote at least a paragraph to the topic of titles of the permanent 
school funds. 

"School fund" is the title given by the constitutions to the state 



PERMANENT COMMON SCHOOL FUNDS 



Table I. Credit Funds'* 



State'' 


Principal^ 


Total 


Intact 


1 Credit 


I. Ala. 




$2,83i,29S<« 


$2,831,295 


2. Ark. 




i,i28,5oo<^ 


1,128,500 


3. Cal. 


$3,237,834 


2,026,000 


5,263,834 


4. Del. 


759.312 


178,850'^ 


938,097ft 


5- la. 


4,746,405 


10,937'' 


4,757,342 


6. Ky. 




2,418,997 « 


2,418,997* 


7. La. 


243,930 (189s) 


1,130,867'' 


1,759,387 


8. Maine 




442,757^ 


442,757 


g. Mich. (1903) 




5,201,852'',/ 


5,201,852 


10. Miss. 


2,464,644™ 


1,002,023!? 


3,466,667 ''^ 


II. Nev. (1906) 


1,038,078 


612,000'' 


1,651,078 


12. N. H. 




59,470",/,' 


59,470' 


13. Ohio 




4,902,110'',/ 


4,902,110 


14. Tenn. 




2,512, 500^ 


2,512,500 


15. Vt. 


344,949 


775,269 


1,120,218 


16. Wis. 


2,045,513 


1,563,700'' 


3,609,213 



permanent common school fund in West Virginia,^^ Connecticut/" 
„ , . „ ^ and Wisconsin.^^ This same title is employed 

Confusing Use of r j 

Term " School in California by the treasurer and by the con- 
Fund " ^ ^ 

troller to designate the "total current annual 

^ Data in this table are taken from letters and data received from state oiEcers 
and from state and federal reports quoted under accounts for each state in Part II. 

*.For 1905 unless indicated otherwise. 

•^ Table VII, pp. 20, 21, gives valuations for all states, being arranged in alpha- 
betical order. 

'' Practically a permanent state debt. 

^ Established or recognized as a permanent state debt by the law or by the 
constitution. 

/ State uses moneys as they are paid into the treasury; credits them to the fund; 
pays interest on the account thus established. 

A non-payable debt. 

ft Secured by state bonds; interest is paid from ordinary state revenues; this 
state has no direct state tax. 

* Interest on this principal is derived from the sinking fund. 

* Data taken from the report of the United States Commissioner of Education; 
may include some local permanent funds. 

' Now used for supporting teachers' institutes only. 
"^ Amount intact not verified. 

19 West Virginia Constitution, Art. X, Sec. i. 

20 Connecticut Constitution, Art. VIII, Sec. 2. 

21 Wisconsin Constitution, 1S48, Art. X, Sec. 2. 



INTRODUCTION 9 

school revenue derived from all sources." ^^ Alabama ^^ and Dela- 
ware ^^ also employ the term "school fund" to designate common 
school current revenue. In Indiana,^^ New York,^^ Oregon,^^ and 
Washington ^* " Common School Fund " is the title of the permanent 
state common school fund. Georgia uses the same term to desig- 
nate the total public school revenue derived from fourteen different 
sources; ^^ Kansas, to designate the total annual revenue for common 
schools derived from all sources; ^° Nebraska, the income from the 
state tax, fines, and forfeitures, and interest on permanent school 
funds; ^^ Ohio, the income derived from the school tax.^^ 

In some states the report of the state superintendent of schools 
frequently employs a title different from that provided by the con- 
stitution and the laws. Thus, in Washington " Permanent School 
Fund" is often used to designate the common school fund. Cali- 
fornia fails to make any specific provision for a title for her per- 
manent common school fund, though both constitution and laws 
refer to it as the state school fund.^^ Custom frequently fixes upon 
a permanent fund a name different from its official title. Thus 
the Michigan Primary School Fund and Swamp Land Fund are 
often called the "Seven Per Cent Fund" and the "Five Per Cent 
Fund." 34 

"Permanent School Fund" is the title employed by the greatest 

22 Statement received from A. B. Nye, California Comptroller, in letter, Dec. 15, 
1906. 

23 Public School Laws of the State of Alabama, compiled by O. J. Turner, 1895. 
Also Report Alabama State Supt. of Education, 1897-98, pp. 58-59; Ibid., 1886, p. 7. 

2* Delaware School Laws, 189S, p. 38, Sec. 27. 

25 Indiana Constitution, 185 1, Art. VIII, Sec. 2. 

26 Laws of New York, 1905, Chap. 587. 

27 Constitution of Oregon, 1859, Art. VIII, Sec. 2. 

28 Constitution of Washington, 1889, Art. IX. Sees. 2, 3. 

29 Georgia School Law, 1903, Sec. 38. Also Report Georgia School . Commis- 
sioner, 1903, p. 404. 

30 Report Kansas State Supt. Public Instruction, 1880, p. 8. 

31 Nebraska School Law, 1899, p. 54. 

32 Ohio School Law, 1898, Sec. 3951. 

33 California School Laws, 1903, apply this title to Art. IX, Sec. 4, of the Con- 
stitution. See also Report California Supt. Public Instruction, 1S64-65, p. 249. 

34 Report State Supt. Public Instruction, Mich., 1903, p. 24. 



lO 



PERMANENT COMMON SCHOOL FUNDS 



number of states; "Public School Fund" comes next to this in fre- 
quency of usage. Table II, without attempting to be complete, 
presents many of the titles employed. Table XVII showing the 
titles of all the permanent state school funds in each state will be 
found on pp. 100-106. 



Table II. 



Official Titles op Permanent Common School Funds and 
States Employing Them 



Title 


No. 


States 


Permanent School Fund 


12 


I Ark., 2 la., 3 Ky., 4 Me., 
5 Minn., 6 Neb., 7 N. D., 
8 R. I., 9 S. C, 10 S. D., 

II Tenn., 12 Tex. 


State Permanent School Fund 


I 


Kansas 


(Name of State) Permanent School Fund 


I 


New Jersey 


Public School Fund 


S 


I Del., 2 Col., 3 Idaho, 
4 Mont., 5 Mo. 


Common School Fund 


4 


I Ind., 2 N. Y., 3 Ore., 
4 Wash. 


School Fund 


3 


I Conn., 2 W. Va., 3 Wis. 


(Name of State) School Fund 


I 


Massachusetts 


Common School Permanent Fund 


I 


Wyoming 


Permanent Public School Fund 


I 


Vermont 


State School Fund 


4 


I Fla., 2 Nev., 3 Utah, 4 Cal. 


Free School Fund 


2 


I La., 2 Md. 


Sixteenth Section Fund 




Ala., Miss., and other states 


Primary School Fund 


1 


Michigan 


Chickasaw Fund 


I 


Mississippi 


Institute Fund 


I 


New Hampshire 


School Fund Proper 


I 


Illinois 


Ohio Irreducible State Debt 


I 


Ohio 



Alaska ^^ and the District of Columbia * never possessed a gen- 
eral permanent common school fund nor reservations either of 
land or of money with which to establish such funds. Pennsyl- 
vania and Georgia both formerly had permanent common school 
funds, but to-day possess none. Georgia devotes state revenues 
derived from railroad and land rents and from certain bank stock 

* Consult the accounts given for each state in Part II. 

35 Statement contained in private letter received August 9, 1906, from E. E. 
Brown, U. S. Commissioner of Education. 



INTRODUCTION II 

to the support of common schools.^^ But the sources of these reve- 
nues do not appear to have been set apart permanently for this pur- 
pose.* The remaining states and territories all possess one or more 
permanent common school funds, intact or credit, or reservations 
of land or of money from which such funds will be created. 

The permanent common school funds differ greatly in value, as 

might be expected. Texas possesses two, the combined principal 

of which amounts, in iqc^, to over fifty-two mil- 

Inequality of ^ 

Funds of lion dollars ($t; 2, 660,489).^^ Minnesota's fund is 

Different States ^ ^ ' ' > y/ 

next in size,t amounting to nearly eighteen million 
dollars ($17,824,135.12).^* The two states having the smallest per- 
manent school funds are New Hampshire and South Carolina. 
The principal of the former's fund amounts to about fifty-nine 
thousand dollars ($59,470);^^ the latter's in 1906, to about forty- 
six thousand dollars.^" In many states the permanent funds and 
the proceeds which should have been added to them have been 
cared for so carelessly, diverted, squandered, wasted, and embez- 
zled so shamefully, that what ought to be a magnificent endowment, 
whose income would to-day be yielding an appreciable relief from 
taxation, has dwindled to an almost negligible sum, or exists as a 
permanent state debt on which interest is paid out of the taxes 
levied upon the present generation. Twenty-eight million dollars 
is a conservative approximate estimate of the sums lost or diverted 
in twelve states, as follows: 

* Consult the accounts given for each state in Part II. 
t Consult footnote 43 on this point. 

36 Georgia School Law, 1903, Sec. 38. Also Report Georgia School Commis- 
sioner, 1903, p. 404. 

37 Data furnished Nov. 23, 1906, by J. W. Stephens, Texas State Controller; 
of. account given in Part II. 

38 Biennial Report, Minn. Supt. of Public Instruction, 1905-06, p. 352. 

39 Statement received July 17, 1907, from H. C. Morrison, N. H. State Supt. 
Public Instruction. 

*o Data furnished Dec. 10, 1906, by R. H. Jennings, S. C. State Treasurer. 



12 PERMANENT COMMON SCHOOL FUNDS 

Table III. Money Lost or Diverted Belonging to Permanent School 

Funds * 

Alabama $2,500,000 

Arkansas 1,250,000 

California 6,800,000 

Georgia 1,100,000 

Indiana 3,000,000 

Kansas 2,000,000 

Louisiana 1,130,867 

Massachusetts 2,842,512 

North Carolina 2,525,000 

Tennessee 1,888,985 

Vermont 1,015,269 

Virginia 1,826,516 

Total $27,880,149 

In a few states, such as West Virginia,^^ and Massachusetts,'^ 
a limit has been set which the principal of the permanent school 
Limited and fund may not exceed. In a few other states, of 

Growing Funds which Connecticut is an example, no means of 
increasing the principal of the fund exists at present, other than 
wise investment. However, most states have set no limit to the 
principal, and in many the funds are being increased rapidly from 
certain sources, the revenues from which are to be forever added 
to the principal of the fund. In Minnesota the Permanent School 
Fund is increasing at the rate of nearly a million and a half a year. 
Twenty-four of the states and territories possess reservations of 
unsold school lands, the estimated value of which must be added to 
the present principal in order to get a true conception of the present 
and prospective relative size of the funds in the different states. 

On p. 20 will be found Table VII, giving complete data. 
Table IV presents (i) the principal of the funds in the different 
states, in millions and thousands, arranged in order of value, and 
(2) the per cent of the total common school revenue in each state 

* For sources of these data see Chapter VI on Loss, in Part I; also accounts for 
each state in Part II. 

*i Constitutional amendment adopted 1902, statement received Feb. 18, 1907, 
from T. C. Miller, W. Va. State Supt. of Free Schools. 

42 Mass. Resolves, 1894, Chap. 90. 



INTRODUCTION 



13 



derived from the income of the principal. Table V shows (i) the 
funds arranged in the order of their estimated total value, including 
the estimated value of unsold school lands, and (2) the estimated 
value of unsold school lands, stated in millions and thousands, the 
proceeds of the sales of which will be added to the principal of the 
permanent common school funds.'*^ 



Table IV. « Permanent Common School Funds in Millions and Thou- 
sands,* Grouped in Order of the Value of Their Principal in the 
Year 1905. « Per Cent of Total Common School Revenue Derived 
FROM Their Income f 





Principal 


Per 




Principal 


Per 
Cent 


States 


mil- 


thou- 


Ce7it 


States 


mil- 


thou- 




lions 


sands 




lions sands 


Group I 






Group II 






Texas 


$52,660 


27.69 


New York 


$8,971 


•7 


Minn. (1904) 


15,978** 


5-3 


N. Dak. 


8,263 


12.6 


Mo. (1902) 


11,566 


7-9 


Kansas (1902) 


7.531 


9-3 


Ind. 


10,641 


S-i 


111. 


7,033 


3-7 


Group III 






Group IV 






Neb. 


6,238 


II. 9 


Ohio 


4,902^^ 


1-59 


Cal. 


5,263'^ 


6. 


Mass. 


4,880 


1.2 


Mich. (1903) 


5,201^^ 


4-5 


S. Dak. (1906) 


4,807 


11.9 


Okla 


5,000 




Iowa 


4,757"^ 


2. 








Oregon 


4,599 


13-5 








N. J. (1902) 


4,523 


2.05 



'^ Data in this table are taken from answers returned by state officers and from 
state and federal reports quoted under accounts for each state in Part II. 

* Table VII on p. 20 gives complete valuations, states being arranged in alpha- 
betical order. 

'^ For 1905 unless indicated otherwise. 

<^ Wholly or in part a credit fund; see pp. 5, 6, 7. For real condition of these 
funds see Table VII, p. 20. 

* « See foot-note 43 for estimate of value. This does not include one-half Swamp 
Land Fund. See account given in Part II. 

t See accounts in Part II for data for Indian Territory and Oklahoma. 

43 It is impossible to secure a satisfactory estimate of the value of unsold common 
school lands. The estimates given are in many cases based on surface area and 
do not include the value of such products as minerals, oil, etc. In Minnesota, in 
1904, the unsold lands belonging to the Permanent School Fund (according to 
data furnished the author Sept. 27, by J. W. Olsen, Supt. of Pub. Instruction) 



14 



PERMANENT COMMON SCHOOL FUNDS 
Table IV — continued 





Principal 


Per 




Principal 


Per 


States 


mil- thou- 


Cent 


States 


mil- 


thou- 


Cent 




lions sands 






lions sands 


Group V 






Group VI 






Wis. 


$3,609'^ 


2.6 


Ala. 


$2,S3i<i 


9.8 


Minn. 


3,466^^ 


10. 


Tenn. 


2,5I2<* 


4-4 








Ky. 


2,418'* 


5-8 








Conn. 


2,022 


3-2 


Group VII 






Group VIII 






Va. 


1,881 


2-3 


Del. 


983 <« 


10.9 


La. 


i.ysQ'^ 


3-7 


Mont. 


871 


3-6 


Nev. (1906) 


1, 651*^ 


49.19 


Md. (1906) 


458 


1-5 


Wash. 


1,477 


8. 


Maine 


442^*! 


I. 


Col. (1906) 


1,408 


4-9 


N. C. 


300 




Idaho (1903) 


1,241 (1902) 


10.2 


Utah (1902) 


291 (1904) 


21.2 


Ark. 


I,I28'« 


1.6 


R. L 


257 


•4 


Vt. 


1,120'^ 


4- 


Wyo. 


173 


49-3 


Fla. 


1,085 


2.28 


N. H. 


59*^ 


•17 


W. Va. 


1,000 


1.8 


S. C. 


46 


.16 








N. Mex. 


19 


7-4 



were estimated as worth $5,354,088.47, which sum added to $15,978,477, the 
principal reported in that year, would give a total estimated value of $21,332,565.47. 
Since this time an eiJort has been made to determine the value of the ore and timber 
on the school land with the result that the state auditor estimates the value of the 
ore lands as at least one hundred million dollars and consequently the prospective 
value of the Permanent School Fund as over $125,000,000 (advance report from 
Biennial Report Minn. State Auditor for the years 1907-08, p. xxxvi). If it were 
possible to secure estimates of a like sort from all the states, a comparison could 
be made here upon a much more satisfactory basis. At the present time, however, 
acreage or surface is the only basis which can be obtained from all states. Enough 
has been said to show that this basis is thoroughly unsatisfactory, if not absolutely 
misleading. In this connection consult the account of the Minnesota Permanent 
School Fund given in Part II. 

'i Wholly or in part credit fund; see pp. 5, 6, 7. For real condition of these 
funds see Table VII, p. 20. 



INTRODUCTION 



15 



Table V.* Permanent Common School Funds Grouped in Order of 
Estimated Value Including Estimated Value of Unsold Lands,* Stated 
IN Millions and Thousands <= 

Estimated Value C' of 



Total Fund 



mil- 
lions 



thou- 
sands 



Unsold Lands 



mil- 
lions 



thou- 
sands 



Group I 

1. Texas $65,660 

2. S. Dak. (1906) 33,254 

3. N. Dak 28,263 

4. Wash 23,727 

5. Okla 22,000 

6. Minn. (1904) 21,332* 

Group II 

7. Neb 18,240 

8. Col. (1906) 16,861 

9. Ill 16,605 

10. Mo.«^ 

11. Idaho (1903) 11,241 

12. Ind 10,676 

13. Kan. (1902) 9,063 

14. N. Y.<^ 

Group III 

15- Cal 5,663 

16. Mich. (1903) 5,614 

17. Ore. (1906) 5,599 

18. Ohio<« 

19. Mass.'' 



Group IV 

20. Mont. 

21. Iowa . 

22. N. J.'^ 

23. N. Mex. 



4,871 
4,775 

4,303 



$13,000 
28,447 
20,000 
22,500 
17,000 
5,354 



12,002 

15,453 

9,571 

10,000 

35 

1,531 



400 

413 
1,000 



4,000 
iS 

4,284 



* Data in this table are taken from answers returned by state officers, and from 
state and federal reports quoted under accounts for each state in Part II. 

'^ See foot-notes 43, and e, p. 13. 

* For 1905 unless indicated otherwise. 

'^ Table VII on p. 20 gives complete valuations, states being arranged in alpha- 
betical order. 

<* Names of states possessing no unsold lands reserved for these funds, or the 
value of whose unsold lands has not been ascertainable, are here inserted to show 
order of value. 



i6 



PERMANENT COMMON SCHOOL FUNDS 



Table V — continued 



Estimated Value « of 


Total Fund 


Unsold Lands 


mil-lthou- 


mil- thou- 


lions\sands 


lions sands 



Group IV 

24. Wis. . $3,708 

25- Wyo 3,173 

Group V 

26. Ala.'^ 

27. Nev. (1906) 2,881 

28. Tenn.<« 

29. Ky.^ 

30. Utah (1902) 2,414 

31. Conn. 

32. Va. 

33- La. 

34- Fla 1,427 



$ 99 
3,000 



1,160 



2,123 



342 



In 1906 Wyoming and Nevada derived nearly half of the moneys 
for the support of their common schools from the permanent 
school funds and land rents; Texas (in 1905) almost one-third; 
Utah (1902) and Oklahoma (1905), approximately one-fifth; Ore- 
gon (1906) and North Dakota (1905), about twelve per cent each; 
six states between ten and eleven per cent; nine states between 
five and nine per cent; eight states between two and three per cent; 
seven states between one and two per cent; and three states less 
than one per cent. 

Table VI, which follows, presents the states grouped according 
to the per cent of their total common school revenues derived from 
permanent school funds and rents on lands belonging to these funds. 



« See foot-notes 43, and e, p. 13. 

^ Names of states possessing no unsold land reserved for these funds, or the 
value of whose unsold lands has not been ascertainable, are here inserted to show 
order of value. 



INTRODUCTION 



17 



Table VI. (^ Per Cent of Total Common School Revenue in 1905 * 
Derived from Permanent School Funds and from Taxation 



Permanent 

School Fund'' 

Per Cent"' 


Local Tax 
Per Cente 


State Tax 
Per Cente 


49-3 


58.42 


0.00 


47.19 (1906) 


35.94 (1904) 


S.18 


27.69 


27.52 


37.60 


21.2 


68.05 


24.40 


20.16'' 


78.55 


0.00 


I3-S3 


82.25 


0.00 


12.6 


67.70 


0.00 


11.9 


81.84 


0.00 


11.9 


66.37 


3.29 


10.9 


67.96 


32.04 


10.54* 


0.00 


0.00 


10.2 


75-41 


10.50/ 


lo.i (1903) 


15.96 (1903) 


67.24!/ 


g.S'* 


28.14 


55-35 


9-3 


87.52 


0.00 


8. 


47-56 


41.16 


7-9 


67.42 


12.35 


7-4 


0.00^ 


60.02* 


6. 


54.33 


45-67 '■ 


5.8^ 


32.42 


62.26 


5-3 


73-59 


15-36 



Group I 
Wyoming (1906) 
Nevada . . . 

Group II 
Texas . . . 
Utah (1904) 
Oklahoma . . 

Group III 
Oregon (1906) 
N. Dakota . . 
S. Dakota . . 
Nebraska . . 
Delaware . . 
Georgia (1901) 
Idaho (1903) . 
Mississippi . . 

Group IV 
Alabama . . 
Kansas (1902) 
Washington 
Missouri (1902) 
New Mexico . 
California . . 
Kentucky . . 
Indiana . . . 



"' Data in this table are taken from answers returned from state officers and 
from state and federal reports quoted under accounts for each state in Part II. 

* For 1905 unless otherwise indicated. 

« Including land rents; not including income of permanent funds of strictly 
local origin. <i A credit fund, see p. 5 ff. 

« Taken from Reports of United States Commissioner of Education, 1905, I, 411, 
and 1906, I, 307. / State apportionment. 

Includes poll tax. fi Included in state taxes. 

* Includes local taxes and income from rent of lands. 

^ Includes taxes on railroads and collateral inheritances. 
'' Rents only of school lands. 

* Income from invested moneys which do not, however, constitute a permanent 
fund. 



PERMANENT COMMON SCHOOL FUNDS 



Table VI — continued 



Permanent 

School Fund" 

Per Cent"' 


Local Tax 
Per Cent^ 


State Tax 
Per Cent" 


5-3^ 


65-25 


4.90 


4-97 


85-33 


0.00 


4-4 


63-97 


15-24 


3-6 


45-79 


38.60 


3-7 


54-99" 


26.23 


3-2 


79-72 


13.69 


2.6 


66.47 


17.29 


2-3 


S3-6o 


44-05 


2.28 


69.09 


18.59 


2.06 


82.33 


0.00 


2.05 (1902) 


66.98 


30.83 


i.e'i 


67-56" 


29.07 


i.S9<^ 


80.59 


10.14 


1. 21 


96-57 


2.08 


1. 5 (1906) 


59-33 


31-84 


1.18 


84.25 


8.72 


1.02'* 


70.94 


25.64 


•7 


66.95 


9.29 


•45 


86.75 


7.80 


•17 


90.86 


1.84 


.16 


18.02^ 


61.53 



Minnesota (1904) 
Colorado .... 
Tennessee .... 

Group V 
Montana .... 
Louisiana .... 
Connecticut (1902) . 
Wisconsin .... 

Virginia 

Florida 

Iowa 

New Jersey . . . 

Group VI 
Arkansas .... 
Ohio 

Massachusetts . . 
Maryland .... 

Arizona 

Maine . . . . . 

Group VII 
New York .... 
Rhode Island . . . 
New Hampshire . . 
South Carolina (1906) 



° Data in this table are taken from answers returned from state officers and 
from state and federal reports quoted under accounts for each state in Part II. 

<= Including land rents; not including income of permanent funds of strictly 
local origin. 

« Taken from Reports of United States Commissioner of Education, 1905, I, 
411, and 1906, I, 307. 

<*A credit fund, see p. 7. ^Includes poll tax. 

* This per cent is computed from data supplied to the author from the Minnesota 
State Auditor's Department, December 28, 1908. There seems to be much con- 
fusion in the answers ordinarily given as to the per cent of total receipts for common 
schools derived from permanent funds. Data furnished September 27, 1906, from 
the Department of Public Instruction, stated that the income derived from the 
permanent school fund in 1904 amounted to $1,192,686.94. The principal of the 
fund at this time was $15,978,477, and the total receipts for common schools for 
this year $10,680,835. According to these data, the principal of the permanent 



INTRODUCTION 19 

, During pioneer days in many states large numbers of school 

districts depended for their school support entirely upon their share 

of the income of the permanent school funds. But 

Present Importance i i i 1 i 

of Permanent when the rcsources of the state had been devel- 

oped, the system of free schools thoroughly estab- 
lished, and taxation for their support accepted, the permanent 
funds became less and less important as sources of revenue. 

The comparatively small per cent of the whole revenue for the 
support of common schools derived from the permanent common 
school funds and land rents is in danger of causing a misconception 
as to their real importance. In South Dakota in 1906 over eighty- 
one per cent of the common school revenue was derived from local 
taxes,^ while less than twelve per cent was derived from the income 
of the permanent school fund and land rents (see Table VI, above). 
Nevertheless, the State Superintendent of Public Instruction writes 
that the revenue from the permanent fund is so large that many of 
the school districts depend upon it for "the large part of their 
support." ^ In Illinois in 1905 over eighty-eight per cent of the 
common school revenue was derived from local taxes (88.87 P^r 
cent) ^^ and less than four per cent from income of permanent 
funds (see Table VI, above), yet the superintendent writes: "A 
very limited number of districts support schools from income 
derived from the principal of permanent funds. These are located 

school fund was bearing over seven per cent interest, and was contributing ap- 
proximately 1 1. 2 per cent of the total annual receipts for common schools. In the 
State Auditor's Department it was stated on December 28, 1908, that the item 
$1,192,686 included the state appropriation as well as the income from the perma- 
nent common school fund, and that the income from the permanent common school 
fund in 1904 was $575,236.49, 5.3 per cent of the total annual receipts for common 
schools. The reports of the United States Commissioner of Education state that 
a much larger proportion of the whole revenue for common schools was derived 
from permanent funds than either of the percentages given above, making it in 
1904 16.23 per cent. Evidently this percentage includes the state appropriations 
or the income from funds other than common school funds, (see Report of United 
States Commissioner of Education). 

*4 Report U. S. Commissioner of Education, 1906, Vol, I, p. 307. 

45 Official statement received Nov. 28, 1906, from M. M. Ramer, State Supt. of 
Public Instruction of South Dakota. 

*8 Report U. S. Commissioner of Education, 1905, Vol. I, p. 411. 



rox. % 

Total 

rived 
Perm. 

; Com. 
Funds 
Land 

ents 


^ CO 


00 -r 




N « t^O N C^t^io^ 


00 w ^0 ^ G^ N 






pooo t^ 10 f^ IT) f w cj^o 0^ w f q ^ c^ 


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ci 0" d CO 10 


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pJdsiOCOMMW^a-^^dt^COH^d^'Nt^*, M 


App, 

De 

from 

State 

Sch. 

and 

R 




1 













"^ 








" 0->0 ^ T Tf 


w CO -J- 




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w Cm 


m c^ 0^ 0^ 0^ »o 


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■^ coo '^ t^; <^ *o c^^ ^^t,^^t*?"l;^ °^ 












Total 
Receipt 

for 
Commc 
School 


CO w N 00 co:» 


CO '-T d^ tC 




fTcO^OO' cCo' *-^ *^ O'CO" coo" cClO C> CO tC CO tC 

N 00 w 00 CO t^co uiwO^t^tot^c-iQ , "* 
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Total 
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Rate of 
Int. St. 
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on Cr. 
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% 


-* --t 







to to-" 


* 1 1 ^11 1 

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22 PERMANENT COMMON SCHOOL FUNDS 

in districts that have not disposed of the sixteenth section." ^'^ 
In 1905 Colorado derived over ninety-five per cent of moneys for 
supporting common schools from sources other than her permanent 
fund;"*"' nevertheless, in the report for the year 1901 the Superin- 
tendent of Public Instruction wrote: "In many of the poorer dis- 
tricts the income of permanent school funds is what enables the 
schools to be maintained for the four months required by law, and 
in other districts it is an important feature."-** It is scarcely 
necessary to comment upon the importance of the permanent 
school funds in such states as Wyoming, Texas, and Nevada. In 
Texas about one-fourth of the total revenue for common schools is 
deri\-ed from the income of the permanent funds, and many dis- 
tricts depend for all or the largest part of their support upon the 
revenue of the County School Fund and the Permanent School 
Fund. J. W. Stephens, State Controller, states that many dis- 
tricts do not levy local taxes, and such depend entirely upon the 
available school and county a^'ailable funds for support.^^ 

The importance of state controlled funds is well illustrated in the 

history of the school systems of Maine, Vermont, and JSIassa- 

chusetts. The matter will be discussed more fully 

Historical Impor- ^ . „ . , 

tance of Permanent later. It IS siuucicnt hcre to say that each of 
these states attempted to do without such a fund. 
Maine and Massachusetts realized their mistake in the early part 
of the nineteenth century, and in 1904 Vermont established hers.* 
The purpose of this work is to show the origin of the permanent 
common school funds, tlicir management, loss, and present condi- 
tion. For a better appreciation of the relation of tliese funds to the 
development of school support, it will be well to devote a chapter 
to the consideration of the sources of school support which existed 
prior to the establishment of the permanent state school funds. 

* See accounts. Part IT. 

47 Statement received Sept. t, too6, from G. T. Blair, Til. State Supt. of Public 
Instruction. 
** Report Colo. Slate Supt. of Public Instruction, 1001-02, p. 62;^. 



CHAPTER II 

EARLY SOURCES OF SCHOOL SUPPORT AND EVOLUTION OF 
PUBLIC PERMANENT SCHOOL FUNDS 

It is possible to open the discussion of the topic of this chapter in 
either of two ways: by discussing the sources of school support 
Wine Sources of existing prior to the establishment in any state of 
PHoTto^GLnwai ^ general permanent common school fund; or 
Permanent Funds y^y Jiscussing the sourccs of school Support em- 
ployed by certain states and territories which themselves as yet 
possessed no permanent school fund. Both points of view will be 
presented to a certain extent in this chapter. At least nine sources 
of school support existed in the United States prior to the estab- 
lishment of general permanent common school funds: (i) appropri- 
ations, (2) rate bills, (3) local taxes on personal and real property, 
(4) taxes on banks, (5) licenses and taxes on occupations and on 
commodities, (6) lotteries, (7) land rents, (8) gifts and bequests, 
(9) permanent funds. 

Connecticut established her School Fund in 1795,'^'' New York 
her Common School Fund in 1805,-'*'^ and Massachusetts her School 
Early Means of Fund in 1834.^^ In Ncw York six sources contrib- 
CoScSrNew uted to the support of common schools prior to 
York, Massachusetts ti^g establishment of her permanent common 
school fund: appropriations, rate bills, town taxes, lotteries, gifts, 
and local funds.* Connecticut employed five of these sources: 
appropriations, rate bills, local taxes, gifts, and local funds; Mas- 
sachusetts, five: local taxes, rate bills, gifts, land rents, and funds. 

It is necessary to state at the outset that most of the sources of 

* The Literature Fund, established in 1786, the first public permanent school 
fund in New York, was devoted to the support of Academical Departments for 
training teachers and therefore is not included in this list. 

*9 Hudson and Goodwin, Digest of Acts and Laws of Conn., 1805, pp. 31-33. 

50 Laws of New York, 1805, Chap. 66. 

51 Mass. Laws, 1834, Chap. CLXIX. 

23 



24 PERMANENT COMMON SCHOOL FUNDS 

school support which existed prior to general permanent common 
school funds continued to contribute to the maintenance of schools 
long after the establishment of these funds. The general perma- 
nent common school fund, then, did not supplant these other 
sources, but served to increase the revenue derived from the more im- 
portant of them by the incentive and unity which it gave to the free 
school movement. The following paragraphs will present only a 
few of the many examples which might be given of the employment 
of the more important sources of support for schools named above. 

Local appropriations by towns date from earliest colonial days. 
For example, in Connecticut we find that Hartford, as early as 
1642, appropriated thirty pounds for the support 
and Federal' of a school conforming to a custom already estab- 

lished.^' Early in the next period of American 
history, individual states followed the example set by colonial 
towns. The legislature of New York in 1795 enacted that twenty 
thousand pounds be appropriated annually for "encouraging and 
maintaining schools in this state, in which there shall be instruc- 
tion in English Language, English Grammar, Arithmetic, and 
Mathematics." ^^ These appropriations expired in iSoo.^'* 

Louisiana, by section i of an Act approved March 6, 1819, pro- 
vided for an annual appropriation of six thousand dollars for sup- 
porting a school or schools, in each parish of the state, except New 
Orleans.^^ Section 3, of an Act approved February 6, 1821, in- 
creased this amount to eight thousand dollars.^^ 

The United States Government has made federal appropriations 
from time to time to meet certain special conditions it," Congress 
has never set aside any school land in Alaska, but has made annual 
appropriations for the support of public schools." The appropri- 
ation for the year 1886 was fifteen thousand dollars. In 1901 the 

52 Hinsdale, B. A., Documents Illustrative of American Educational History; 
Report U. S. Commissioner of Education, 1892-93, Vol. II, p. 1240. 

53 Laws of New York, 1795, Chap. 75. 

54 Randall, S. S., History of the Common School System of the State of New York, 
ed. 1871, p. 96. 

55 Lislet's Digest, 182S, p. 348. 
66 Ibid., p. 351. 



EARLY SOURCES OF SCHOOL SUPPORT 25 

annual appropriation was increased to thirty thousand dollars," 
and in 1905 to fifty thousand dollars.^^ Congress makes annual 
appropriations of one-half the cost of maintenance of public 
schools in the District of Columbia.^^ ( 

Rate bills were a form of tuition levied as a tax on parents and 

guardians to pay that portion of the teacher's salary not covered 

by public moneys. Like appropriations, they 

Ra.te Bills 

existed from earliest colonial days. As stated in 
Chapter I, they were employed as long as the principle that the 
parent or guardian, and not the state or community, is responsible 
for the education of the child, continued to control educational pol- 
icy. The term '' bills " was applied to them because each parent 
or guardian was charged according to the number of days his child 
had attended school. They could be collected, hke other debts 
and taxes, by the sale of the debtor's goods and chattels.^" The 
earliest record of them in Connecticut occurs in 1643. At a gen- 
eral town meeting of Hartford, held in April, it was ordered: 

"That Mr. Andrew should teach the children in the school one year next 
ensuing from the 25th of March, 1643, and that he shall have for his pains 
sixteen pounds; and therefore the townsmen shall go and inquire who will 
engage themselves to send their children; and all that do so shall pay for one 
quarter at the least, and for more if they do send them, after the proportion 
of twenty shillings the year, and if they go any weeks more than an even 
quarter, they shall pay six pence a week ; and if any would send their children 
who are not able to pay for their teaching they shall give notice of it to the 
townsmen, and they shall pay it at the town's charge; and Mr. Andrew shall 
keep the account between the children's schooling and himself, and send 
notice of the times of payment and demand it; and if his wages do not come 
in, the townsmen must collect and pay it; or if the engagements come not to 
sixteen pounds then they shall pay what is wanting at the town's charge." ^i 

57 Report U. S. Commissioner of Education, 1902, Vol. II, p. 1237, gives table 
of appropriations 1866-1901. 

w Statement of U. S. Commissioner of Education for year ending June 30, 1905, 
pp. 26, 27, 33. 

59 Statement by A. T. Stewart, Director of Intermediate Instruction, Washing- 
ton, D. C, Sept. 21, 1906. 

60 Report N. Y. State Supt. Public Instruction, 1848, pp. 41 ff. 

61 Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report U. S. Commissioner of Education, 1892-93, p. 1240. 



26 PERMANENT COMMON SCHOOL FUNDS 

An entry made in the public records of New Haven, dated 
November 8, 1652, relative to engaging Mr. James as school- 
master, states that: 

"The town was willing to encourage ^Ir. J^^rnes his coming, and would 
allow him at least ten pounds a year out of the treasur}', and the rest he might 
take of the parents of the children he teacheth by the quarter, as he did be- 
fore, to make up a comfortable maintenance." *^ 

This method of supporting schools, begun by the colonies, was 
continued by the states. Some states employed rate bills as a form 
of support throughout the entire school term. Others, such as 
Illinois ^^ and Indiana/'"* maintained free schools for a definite 
period, after which parents were permitted to continue the school 
term, if they wished, by subscription or by rate bills. 

Pennsylvania has long been proud of her claim that rate bills 
were abolished in 1834, the year in which was passed that state's 
first act providing for a general system of common schools. Wick- 
ersham writes, "Public schools in Pennsylvania have always 
been entirely free. . . . Rate bills, so common in the public 
schools of our older states . . . never had an existence in Penn- 
sylvania." ''^ This statement, though in the main correct, is thor- 
oughly misleading. The laws enacted in 1S34 and 1836 left the 
establishment of public schools to the option of the individual 
districts. It was not until 1848 that such establishment was made 
compulsory for the entire state. Prior to 1S34 and from 1834 to 
1848, large numbers of districts supported their schools almost 
entirely by tuition fees, although after 1834 any public schools 
maintained by districts must be absolutely free.* 

It is unnecessary to say that as long as rate bills were employed 
the schools of the community, though public, were not free. The 

* For references to law and for a more complete account, see Part II. 

62 Ibid., p. 1243. 

63 Report Conn. Board of Education, iS6S, p. 40. 
"Ibid., p. 51. 

65 James Pyle Wickersham, History of Ediicalion in Pcnn., p. 343. See also 
fc«st-note 69. 



EARLY SOURCES OF SCHOOL SUPPORT 



27 



disastrous effects of such a system upon popular education are 
easy to understand. B. G. Northrop, Secretary of the Connecticut 
Board of Education, in his report for 1868, printed letters received 
from the superintendents of public instruction in the various states. 
The following table, without being complete, nevertheless shows to 
what a late date rate bills, or tuition fees, continued to be employed 
in many states : 

Table VIII. Rate Bills 



Year 
A bolished 



Year 
A bolished 



MassachuseUs 182768 

Delaware 1S2967 

Pennsylvania 183468 

Florida 186968 

Vermont 1850™ 

Indiana 1851^1 

Ohio 1S5372 



Iowa 1858^3 

New York 1867 

Rhode Island i86874 

Connecticut i86875 

Arkansas i86876 

Virginia iS-jqT' 

Utah 189078 



The importance of rate bills as a source of revenue and the 
strength of their influence can be realized by noting the large per 
cent they contributed to the support of public schools. In Rhode 

66 Laws of Mass., 1827, Chap. 143, Sec. 4. 

67 An Act for the Establishment of Free Schools, passed Feb. 12, 1829. 

68 Letter from J. P. Wickersham, Apr. 17, 1868, printed in Conn. Board of 
Education Report, 1868, p. 57. 

69 Report U. S. Commissioner of Education, 1894-95, Vol. II, p. 1600. 

70 An Act relating to Common Schools, Nov. 13, 1850. 

71 Constitution, 1851. 

72 Letter from E. E. White, Ohio State Supt. of Schools, printed in Report 
Connecticut Board of Education, 1868. 

73 Report Iowa Supt. Public Instruction, 1896-97, p. 22. 

74 Letter from J. P. Chapin, Rhode Island Supt. Public Instruction, Mar. 31, 
1868, printed in Report Conn. Board of Education, 1868, p. 66. 

75 Laws of Conn., 1868, Chap. LXXIII, passed July 24, 1868; law is quoted in 
Report Conn. Board of Education, 1869, p. 217. 

76 Act approved Feb. 3, 1843, attempting to establish free schools was ineffective. 
Constitution, 1868, made schools free. Report Ark. State Supt. Public Instruction, 
1887-88, pp. 44 S. 

77 Virginia Laws of 1870, Chap. 259, act approved July 11, 1870. 

78 Report Utah State Supt. Public Instruction, 1898-1900, p. 54. 



28 



PERMANENT COMMON SCHOOL FUNDS 



Island in the year 1852-53, ten per cent of the expenditure for 
public schools was derived from rate bills."^ 

The following table shows the importance of rate bills in Connect- 
icut during the last twelve years they were employed: 

Table IX. Connecticut Total School Revenue and Chief Sources of 

Income 1S56-6S so 



Report of 


Rate Bills 


District Tax 


School Fund 


Total School 


Year 






Incoiiie 


Revenue 


1856 


$31,839 


$39,487 


$129,038 


1331,821 


1S58 


38,960 


52,637 


140,763 


356,575 


i860 


38,381 


84,419 


134,033 


390,201 


1862 


31,847 


87,231 


124,647 


391.550 


1864 


29,466 


96,964 


132,589 


390.454 


1866 


49,984 


201,066 


132,048 


562,241 


1867 


76,442 


317,977 


130,658 


704,986 


1S68 


89,260 


466,932 


132,972 


983,806 



In the majority of states to-day the largest part of the revenues 

for the support of public schools is derived from local taxation. It 

might be said that the history of school support is 

Voluntary Local ^ , ■' ^^ 

Taxation Succeeded contained in the development of this method of 

by Compulsory ... ,,,_,_ , , 

maintaining schools. The first attempts at local 
school taxation in America were made by colonial towns, independ- 
ently. In early colonial clays, we find town meetings determining 
that a local tax shall be levied to pay, in part, for the support of 
schools. In 1658 Weathersfield voted: 

"That Mr. Thomas Lord should be schoolmaster for the year ensuing, 
and to have twenty-five pounds for the year, and also the use of the house lot, 
and the use of the meadow as formerly; and the twenty -five pounds is to be 
raised of the children, eight shillings per head of such as come to school, 
and the remainder by rate of all the inhabitants made by the lists of estates." ^^ 

Here, then, is illustrated the first step in local taxation, a local tax 

79 Thomas B. Stockwell, History of Public Education in R. I. from 1636 to 1S76, 
p. 81. 

80 Table taken from Report Conn. Board of Education, 1868, p. 33. 

81 Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report U. b. Commissioner of Education, 1S92-93, p. 1241. 



EARLY SOURCES OF SCHOOL SUPPORT 



29 



initiated by the inhabitants of the community. The second step is 
taken when the colony or state passes a general law permitting 
local units to tax themselves. 

In Chapter I it was pointed out that taxation for schools was 

permitted in Massachusetts as early as i647.'^ The Connecticut 

Code, 161^0, of Laws for the Government of the 

Local Taxation 

in Massachusetts Commonwealth, under the title "Schools," pro- 

Colony -111 1 • . , . , 

vided that every township within the common- 
wealth containing fifty householders should maintain a school. 
The wages of the schoolmaster " shall be paid either by the parents 
and masters of such children as shall report to him, or by the inhab- 
itants in general by way of supply, as the major part of those who 
order the prudentials of the town shall appoint." ^^ 

In 1662 the colonies of Connecticut and New Haven united. 

Fifteen years later, at the May session of the 

Local Taxation •' ' ■' 

in Connecticut court, an Order was adopted one provision of 
which reads: 

"// is also ordered by this court, Where schools are to be kept in any town, 
whether it be county town or otherwise, which shall be necessary to the main- 
taining the charge of such schools, it shall be raised upon the inhabitants by 
way of rate, except any town shall agree to some other way to raise the main- 
tenance of him they shall employ in the aforesaid works (conducting a Latin 
school), any order to the contrary notwithstanding." 83 

The third stage in the development of local taxation is reached 
when the commonwealths compel the local units to tax themselves 
for the support of schools. 

In 1677 the colony of Plymouth provided that every township 
within the colony, of fifty families, in which a master shall be 
obtained to teach a grammar school, should allow at least twelve 
pounds in current pay to he raised by rate on all the inhabitants 
of such town, and those that have children attending such school 
shall make up the residue not covered by gifts or moneys received 
from other sources.*^ 

82 Ibid. 

83 Ibid., pp. 1245, 1247. 

84 Ibid., p. 1239. 



30 PERMANENT COMMON SCHOOL FUNDS 

The famous Connecticut Code completed in 1700 contained 
three provisions of great importance: (i) that every town of seventy 
Connecticut houscholdcrs or more must maintain a school 

Code, 1700 eleven months; (2) that every town of less than 

seventy householders must maintain a school for at least six months; 
and (3) that towns shall levy a school tax of 40s. on every j^iooo.^* 

New York, by the Act of 1795, provided that each town, in order 
to participate in the annual appropriations of twenty thousand 
pounds referred to in this chapter,* must raise by tax a sum equal 
to one-half the public money it received.^^ 

From these facts it will be seen that the custom of compelling 
towns to tax themselves for the support of schools was begun in 
state and Terri- colonial days and continued after the formation 
Local xSron""^^ ^^ ^^^^ Union. States admitted later followed, to 
for Schools a considerable extent, the precedent established 

by the original states. Maine provided for a compulsory per 
capita tax in 1821, the year following her admission into the Union, 
and a voluntary local tax for erecting and repairing school build- 
ings. Minnesota was established as a territory by Congress in 
1849.^^ Her school lands yielded no income until 1863. Dur- 
ing territorial days county commissioners were required to levy an 
annual two and one-half mill tax on all taxable property, to which 
was added fifteen per cent of all moneys accruing from liquor 
licenses and fees for criminal offenses. Money thus accumulated, 
known as the county school fund, was used for teachers' wages 
only. Districts were to raise, by voluntary, self-imposed taxes, 
moneys for building and furnishing school-houses.*^ 

In the territory of Arizona at the present time (1906), there are 
reserved for its future use over four million acres of school lands.*''' 
These lands cannot be sold, and consequently no permanent funds 
can be established from their proceeds until Arizona becomes a 
state, without some special provision of Congress. Since the organ- 

* See page 24. 

85 Report Minn. Supt. Public Instruction, 1878, pp. 7, 8. 

87 Data furnished Sept. i, 1906, by R. L. Long, Ariz. Territorial Supt. of Schools; 
consult Arizona in Part II. 



EARLY SOURCES OF SCHOOL SUPPORT 



31 



ization of Arizona as a territory, schools have been very largely 
supported by taxes upon the territorial and several county treas- 
uries.^^ The rate of territorial taxes in 1905 was three cents on 
the hundred dollars.^^ 

Maine provided for the establishment of her Permanent School 
Fund in 1828,^^ but it was not until 1851 that revenue derived from 
this fund was distributed to the towns.^^ On 
January 23, 1821, the legislature of Maine passed 
an act imposing a semiannual tax of one-half of one per cent upon 
all banks of the state. In March, 1833, an act was passed pro- 
viding that subsequently the bank tax should be distributed to the 
towns and plantations of the state according to the number of 
their pupils.^*^ In 1833 the amount contributed by bank taxes to 
the support of pubhc schools was $18,389;^^ in 1863, $79,830.^2 
Income from the bank tax was greatly diminished when many of 
the banks gave up their state charters and entered the national 
banking system. This tax ceased in 1869.^^ Other states used 
taxes levied upon banks as a source of state aid prior to the estab- 
lishment of the state fund. One of the first forms of aid given 

by the state in Indiana was a state bank tax provided for in 
1834.^3 

Both colonies and territories have devoted licenses for pursuing 

certain occupations and for dealing in certain commodities to the 

support of schools long before the establishment 

Licenses 

of general permanent school funds. Fees derived 

from fish licenses, known as "cape money" were devoted to the 
colony of Plymouth for the support of a grammar school as early 
as 1673.^'' In May, 1766, Connecticut passed an act granting, for 
the support of schools, arrears due for taxes upon liquors, teas, and 

86 Report U. S. Commissioner of Education, 1882-S3, p. 2S3. 

88 Laws of Maine, 1828, Chap. 403. 

89 Maine School Report, 1855, p. 16. 
80 Maine School Report, 1S57, P- ^S- 

91 Maine School Report, 1855, p. 14. 

92 Maine School Report, 1869, p. 156. 

93 Report Ind. Supt. Public Instruction, 1871-73, pp. 15-16; Laws of Ind., 1S34, 
Chap. 7. 

94 Plymouth Colonial Records, V, pp. 107, 108. 



32 PERMANENT COMMON SCHOOL FUNDS 

some other commodities imposed several years before, also the 
interest on excise money that had up to this time accumulated. 
In 1774 an act was passed giving the principal of such excise money 
to the towns in which it had been collected, for school purposes.^^ 
Gambling licenses and liquor hcenses have been, to a large extent, 
devoted to the support of schools from very early times. Minne- 
sota, as stated above, during her territorial days, devoted fifteen 
per cent of moneys derived from liquor licenses and fees for crim- 
inal offenses to the support of the schools. Arizona devotes 
gambling licenses, fines, and forfeitures to the same object at the 
present time.* 

Lotteries were a means extensively employed in the early decades 
of the nineteenth century for supporting public or philanthropic 

institutions. Both colleges and public schools de- 
Lotteries . , . , . A 1- ■ 

rived aid from them. A few instances will sug- 
gest the extent to which they were used. With the expiration in 
1800 of annual school state appropriations, New York found it 
necessary to provide other means of aiding public schools. In 1801 
an act was passed directing that $100,000 be raised by means of 
four successive "literature lotteries" of $25,000 each; $12,000, i. e., 
one-eighth of the entire amount to be paid to the regents for dis- 
tribution as they see fit among the academies; the remaining seven- 
eighths, $82,500, to be paid into the treasury for the encouragement 
of such schools as the legislature might thereafter direct.^^ These 
"literature lotteries" did not cease until prohibited by the state 
constitution of 182 1, which forbade all lotteries.^^ Rhode Island 
used lotteries both as a source of annual revenue for common 
schools and for increasing the principal of her Permanent School 
Fund.^^ Between the years 1812 and 1838 Congress passed four- 
teen joint resolutions authorizing lotteries for the support of schools 

* See account in Part II. 

95 Report Conn. Board of Education, 1876, p. 108. 

96 Laws of New York, 1801, Chap. 126. 

97 Randall, S. S., History of the Common School System of the State of N. Y., 
ed. 1871, p. II. 

98 Thos. B. Stockwell, History of Public Education in R. I. from 1636 to 1876, 
P-4S- 



EARLY SOURCES OF SCHOOL SUPPORT ^^ 

in the District of Columbia.^^ The District of Columbia employed 
' 'teries as a means of raising money to support the first two public 
schools ever established in the district, and eventually $40,000 
was raised as a permanent fund. to support two charity schools.^^'^ 

The discussion of permanent funds as a means of school support 
has been reserved until now, not because they were of later origin 
than certain of the sources already presented, but because a dis- 
cussion of them will involve a description of the evolution of public 
permanent school funds, the second topic included in this chapter. 

The beginnings of estabhshing permanent funds for endowing 
schools are difficult to determine. The monastic schools in the 
Private and Middle Ages were supported chiefly from the in- 

Local Funds come of lands belonging to the monasteries. 

Within a comparatively short time after the suppression of monas- 
teries in England by Henry VIII, schools arose endowed by rulers, 
nobles, and wealthy men of every class. The custom of endowing 
schools which had been followed abroad was early carried to the 
western continent. James I, in 161 7, suggested a school for the 
Indian youth of Virginia. The London Company subscribed one 
thousand acres of land, five servants, and an overseer for the 
maintenance of the master and an usher. Buildings were erected, 
but the Indian war in 1622 put an end to the work. 

Local funds resulting from private bequests were early estab- 
lished in Virginia, New Hampshire, Massachusetts, Cormecticut, 
and other colonies. The Benjamin Simms School, 

Gifts and Bequests 

of Cattle, Slaves, founded in 1642, located on the Poqoson river in 

and Lands _,. . . ... , , -r. 

Virginia, owes its origin to such a bequest. Ben- 
jamin Simms, by his will made in 1634-35, gave two hundred 
acres of land, "with the milk and increase of eight cows for the 
maintenance of an earnest and honest man" to keep a free school 
for the education of the children of the parishes of Elizabeth City 
and Kiquotan.^°° The Henry Peasley Free School, located in 

99 Report District of Columbia School Board, 1874-75, pp. 18-31. Reference 
taken from letter to author from A. T. Stewart, dated Sept. 25, 1906. 

99" Barnard, History of Public Schools in the District of Columbia, p. 52. 

100 Neil, Edward D., Virginia Carolorum, pp. 112-113. 



34 PERMANENT COMMON SCHOOL FUNDS 

Gloucester county, Virginia, owes its origin to a bequest made by 
Henry Peasley in 1675, consisting of six hundred acres of land, ten 
cows, and one mare. Later, other patrons gave slaves, cattle, and 
additional land.^°^ Captain John Mason, who died in 1636, be- 
queathed one thousand acres of land for maintaining a free gram- 
mar school for the education of youth in New Haven.^°" 

The first permanent school fund established in Connecticut 
owes its origin to a bequest of Edward Hopkins, who died in 1658. 
As a result of this bequest, Hartford received four hundred pounds 
(;^40o). New Haven four hundred and twelve pounds (;^4i2), and 
Hadley three hundred and twelve pounds (£312). Hartford used 
the money at first to support a free elementary town school and 
later a grammar school. Hadley appears to have used its share 
to support an elementary school; New Haven her share to sup- 
port a grammar school.^"^ In 1673 Robert Bartlett left all his 
estate to the town of New London for the education of the 
children.^o^ 

Side by side with the permanent local funds originating from 
private bequests, were permanent local funds created by the towns 
Public Local themselves for the support of schools within the 

^'^^^^ town. November 10, 1 641, Boston reserved Deer 

Island for the maintenance of a free school for the town.^*^^ In 
1639 Dorchester reserved Thompson's Island for the support of a 
school, and in 1657 reserved one thousand acres more for the same 
purpose.^"*^ 

This policy pursued by the towns, of establishing permanent 
funds for the support of schools was early adopted by certain of 
the colonial governments. Both Massachusetts and Connecticut 
made grants of land to towns for the support of grammar schools 

101 Brown, E. E., The Making of the Middle Schools, pp. 49-50. 

102 Capt. John Mason, Prince Society Pub., p. 104; Jos. Schafer, Origin oj 
System of Land Grants for Education, p. 11. 

103 Report Conn. Board of Education, 1876, p. 103. 

104 Ibid., pp. 122-123. 

io^ Memorial T^' lory of Boston, IV, pp. 238-239. , 

106 Histo _ of Dorchester, pp. 160-163, 420-424; Schafer, Origin of System of 
Land Grants for Education, p. 12. 



EARLY SOURCES OF SCHOOL SUPPORT 35 

within the towns. Connecticut in 1672 granted six hundred acres 
each to the four county towns of Fairfield, New London, New 
Haven, and Hartford for the support of a grammar school.^''' In 
1659 the General Court of Massachusetts Bay granted the towns 
of Charlestown and Cambridge one thousand acres of land each on 
the condition that they forever appropriate it to maintaining a 
grammar school.^^^*^ 

The grants of land thus far described are special or local. They 
do not represent, as a rule, a policy adopted for the entire common- 
Beginnings of wealth. The next step forward toward a system 
Town^s^chooi^Lands, of general endowment of schools was the reserva- 
Connecticut, 1726 ' ^j^^^ ^f j^^^j f^^ schools in towns yet to be setded. 

With this step begins a policy of far-reaching influence and of the 
greatest historical significance, as will appear later. In 1687 the 
colony of Connecticut granted more than one-half of what is now 
Litchfield county to the towns of Hartford and Windsor, to save 
this land from the cupidity of the royal governor, Andros. Hart- 
ford and Windsor refused to restore this land to the colony, as it had 
been expected they would do when the troublesome times ceased. 
A controversy arose which resulted in a compromise in 1726. The 
territory was divided in half, the eastern half was given to Hartford 
and Windsor, and the colony took the western half, which it laid 
out in seven townships. Five of these townships were divided 
into fifty-three parts each. Three parts in each town were re- 
served, one for the support of the town school and two for the 
ministry. 

In May, 1733, the assembly enacted that these seven towns be 

sold and the proceeds divided among the towns of the colony 

already settled, in proportion to their respective lists of polls and 

ratable estate, the proceeds to be set apart by 

Connecticut Per- ' ^ , ^ -^ 

manent Colonial each town as a permanent fund, the interest on 

and Town Funds ir-irii iir i 

which was to be faithfully expended for the sup- 
port of the schools required by law; towns containing more than one 
parish, to divide the fund among their several parishes in propor- 

106" Colonial Records of Massachusetts Bay, IV, p. 400; Schafer, Origin of System 
of Land Grants for Education, p. 22. 



36 PERMANENT COMMON SCHOOL FUNDS 

tion to their respective lists. Six of these townships were sold in 
1783, the seventh a few years later.^^'^ 

From the proceeds of the sales of these town lands, two classes 
of permanent school funds arose: (i) the fund belonging to the col- 
ony which was distributed among the towns of the colony; (2) 
funds belonging to new towns, rising from reservations of school 
lands within the towns. The second part of this policy was incor- 
porated as a feature of a plan presented by the Susquehanna 
Company of Connecticut in 1768. This company undertook to 
establish a settlement for Connecticut in the Wyoming Valley. 
The Susquehanna Company divided its land into townships each 
five miles square, reserving three shares in each township for the 
ministry and schools, the three shares amounting in all to 960 
acres.^"^ 

The Connecticut colonial policy of reserving lands in each town 
was adopted soon after the formation of the Union by several 
states: Georgia, New York, Massachusetts, and others. One of 
the provisions of the Act passed by Georgia, July 31, 1783, reads as 
follows : 

"And be it further enacted that upon the application of any person or 
persons duly authorized by the respective counties, His Honor, the Governor, 
shall be and is hereby likewise empowered to grant one thousand acres of 
vacant land for erecting free schools. . . ."WJ 

New York, in 1786, provided that the unappropriated lands of 
the state be laid out in townships of sixty-four thousand acres.^^" 
Two lots, known respectively as the "Gospel and School Lot" 
and the "State Lot" were reserved in each township: the first, for 
the support of the gospel and schools within the township; the 
second, or state lot, for the future use of the state. In 1789 pro- 
vision was made for the sale of the "Gospel and School Lot" in 

107 Report Conn. Board of Education, 1876, p. 106. 

108 Report Conn. Board of Education, 1876, p. 109; Hinsdale, B. A., Documents 
Illustrative of American Educational History, Report U. S. Commissioner of Edu- 
cation, 1892-93, p. 1265. 

los Digest of the Laws of the State of Georgia, 1755-1802, pp. 132, 134, Sec. 14. 
"0 Laws of New York, 17 86, Chap. 67. 



EARLY SOURCES OF SCHOOL SUPPORT 37 

each township, thereby completing the estabhshment of these 
township funds.^^^ Lands thus reserved for the use of the township 
included about forty-seven thousand three hundred and eight 
acres.^^^ 

The legislature of Massachusetts, in 1788, provided that in the 
disposition of all town lots thereafter, whether granted or sold, 
four lots of three hundred and twenty acres each should be re- 
served as follows: two lots for the minister; one for the support of 
the common schools in the township, one for the future disposition 
of the state.^^^ 

In the evolution of permanent school funds just traced, five 
types are evident: (i) funds arising from private gifts and bequests; 
stages in Evolution (2) funds arising from reservation of lands by the 
Generai^itlte town for the support of schools within the town; 

School Funds ^^^ funds arising from grants of lands to particular 

towns by the colonial government; (4) funds arising from the pro- 
ceeds of the sale of the unsettled lands for the benefit of the already 
settled pohtical units; (5) funds arising from school lands reserved 
in towns yet to be settled, for the support of schools within the 
town. The permanent school funds in the United States owe their 
origin to the further extension of the policy represented by the last 
type. It was only necessary for the states and for the federal Gov- 
ernment, after the formation of the Union, to adopt and develop 
this policy respecting their unsettled lands to bring about the 
creation of the permanent state funds. 

It may be said that the public permanent school funds in the 

United States arose, then, as the final stage in the evolution of one 

species of school support. It must not be for- 

Conclusion: Need '- • 1 1 

of State Permanent gotten at any pomt, that they arose, not only to 
fulfil the principles of liberty and democracy, but 
to fulfil a great social need. The sources of school support de- 
scribed in this chapter were insufficient to put free public schools 
upon a reputable and solid foundation, at a time when the support 

"1 Laws of New York, 1789, Chaps. 32, 44. 

112 Report N. Y. State Supt. Public Instruction, 1833, p. 61. 

113 Maine School Report, 1898, pp. 49-50. 



38 PERMANENT COMMON SCHOOL FUNDS 

of such schools was regarded largely as a work of charity rather 
than as a public necessity and opportunity. The actual condition 
of the schools during this period has been suggested in Chapter I, 
and will be discussed more fully in Chapter VI. Here, it is suffi- 
cient to say that before stable systems of schools could be estab- 
lished in the several states, some sure, unfluctuating means of 
support must be supplied. Such a means was supplied by estab- 
lishing public permanent common school funds, the origin of 
which is the subject of the next two chapters. 



CHAPTER III 
FEDERAL SOURCES OF PERMANENT COMMON SCHOOL FUNDS 

The sources from which permanent common school funds in 
the United States have been derived may be divided into two 
General ciassifica- classes, State and federal. The state sources of 
tion of Sources permanent common school funds include (i) state 
lands, (2) state moneys. The federal sources include likewise: 
(i) lands owned by the United States, reserved for schools when 
the territory was first surveyed, and granted to the individual town- 
ships or to the state when the state was admitted into the Union; 
(2) federal moneys include federal loans, grants and appropriations. 
As will appear later much federal land and much federal money 
devoted by the states to their permanent common school funds was 
so devoted at their own option. 

In the preceding chapter it was shown how, beginning in 

colonial times, the policy arose of reserving for schools one or more 

sections of land in newly surveyed townships. 

School Land ■' ■' ^ 

Policy of Before New York and Massachusetts had adopted 

United States 

this policy, the United States Government had 
undertaken measures for dividing its western territory into town- 
ships six miles square, laid out in thirty-six sections each one mile 
square, and reserving one section (i. e., 640 acres) in each township 
for the support of common schools. These western lands had been 
claimed at first by the individual states. The first permanent 
state fund, that of Connecticut, which was established in 1795, was 
created from proceeds of sales of lands lying within this western 
territory.* It is necessary, therefore, at this point to give an account 
of how the vast western territory originally claimed by the states 
came to be owned by the federal Government. 

* The account given of the origin of the Ohio fund (Irreducible Debt) in Part II 
should be read in connection with this chapter. 

39 



40 



PERMANENT COMMON SCHOOL FUNDS 



France, by right of discovery and of settlement, originally 
claimed that vast region in North America known by the general 
Origin of Federal name of Louisiana, lying between the Allegheny 
ConfiiSg^"^^^* ^^^ Rocky mountains. Her claims were opposed 
Land Claims ^y England and Spain. By the Treaty of Paris 

in 1763, France ceded all her possessions east of the Mississippi 
river to England. By this treaty the Mississippi river became the 
boundary between the British and Spanish possessions. Long 
before the Treaty of Paris, England, ignoring the claims of France, 
had granted tracts of this western territory to companies and 
colonies. In 1609 the London Company which established the 
colony of Virginia, was granted all the territory extending along 
the coast for two hundred miles north and south of Point Comfort 
and up into the land from sea to sea, west and northwest, but in 
1624 this company was dissolved and the grant resumed by the 
crown. 

The charter of Connecticut granted by Charles II in 1662, con- 
veyed to the governor and company of the English colony of Con- 
necticut, land which included parts of Rhode Island, New York, 
New Jersey and all land west of New Jersey between N. latitude 
41 and 42° 2' through to the Pacific Ocean.^^ The land lying 
within New York and New Jersey included in this charter had been 
previously granted to Plymouth under the charter of 1620. As 
the result of these conflicting grants. New York, Massachusetts, 
Connecticut, and Virginia all claimed the same region of land lying 
north of the Ohio River, while western New York was claimed by 
Massachusetts, and northern Pennsylvania by Connecticut. In 
like manner North Carolina, South Carolina, and Georgia claimed 
the vacant lands in the southwest. The claims of Massachusetts 
were founded upon her charter granted in 1691. New York's 
claim rested principally upon the treaty made in 1684, between 
England and the Indians, and upon money the colony had spent 
to enforce the English claims to this land. 

Before the close of the Revolution confusion and antagonism 
reigned as a result of these conflicting claims. On June 29, 1776, 
Virginia asserted her claim to all lands granted by the charter 



FEDERAL SOURCES OF SCHOOL FUNDS 41 

of King James in 1609.^^^ This claim was open to serious ques- 
tion since in 1624 the London Company had been dissolved and the 
Maryland Opposes grant resumed by the crown. Four months after 
Virginia's Claims Virginia's asserting her claim Maryland made 
a formal protest as follows :^^^ 

^^ Resolved unanimously, That it is the opinion of this convention, that the 
very extensive claim of the state of Virginia to the back lands hath no founda- 
tion in justice, and that if the same or any like claim is admitted, the freedom 
of the smaller states and the liberties of America may be thereby greatly 
endangered; this convention being firmly persuaded that if the dominion 
over these lands should be established by the blood and treasure of the United 
States, such lands ought to be considered as common stock, to be parcelled 
out at proper times into convenient, free and independent governments." 120 

In 1778 Virginia successfully conducted an expedition against 
the British and their Indian allies who had been harrassing her 
own frontiers and those of Pennsylvania and New York. This 
same year the General Assembly of Maryland instructed her repre- 
sentative in Congress to refuse to agree to the Articles of Confeder- 
ation unless an article be added declaring that the country unset- 
tled at the commencement of the war and claimed by the British 
crown should be considered as the common property of the thirteen 
states "to be parcelled out by Congress into free, convenient and 
independent governments in such manner and in such time as the 
wisdom of that assembly shall hereafter direct." ^^^ Nevertheless, 
Virginia, in 1779, opened an office for the sale of her western lands. 

Of these conflicting claims that of the United States was held 
to have had the soundest basis, for several reasons. As pointed 
Origin of o^^ abovc, the company to which the charter of 

Federal Lands Virginia had been granted had been dissolved 

and the grant resumed by the crown. Moreover, large tracts of 
territory included within its original limits had been patented to 
various individuals and associations without remonstrance on the 

118 Hening, Wm. W., Statutes at Large, Vol. IX, p. 118. 

119 American History Leaflets, p. 3. 

120 Conventions of Maryland, p. 293. 

121 Journals of Congress, V, pp. 208-211. 



42 PERMANENT COMMON SCHOOL FUNDS 

part of Virginia. The expenses Virginia had incurred in her efforts 
to protect the frontier created just claim upon the United States 
treasury, but could not give title to the western lands. Connecticut, 
in her agreement with New York, had so clearly defined her bound- 
ary line that her claims to western territory might well be called in 
doubt. Massachusetts' claims rested upon a charter granted at a 
period when the territory now claimed under it was actually 
possessed and occupied by France. The claims of New York 
could be refuted upon an appeal to western geography, and 
investigation into the real extent of the territory occupied by the 
Six Nations.''" 

Congress, to support the claim of the United States, passed a reso- 
lution earnestly recommending to Virginia the reconsideration of 
her act, and recommendino; further all other states 

Congress Appeals , "-^ , 

to States to Cede to forbear settling or s;rantiner unappropriated 

Their Land Claims ,,,. , ^ ^ ^, , . 

lands during the present war. io enforce this 
recommendation Colonel Broadhead was stationed in the western 
country to prevent settlement. The controA'crsy respecting western 
lands continued to delay the ratification of the Articles of Confeder- 
ation and increased the difliculties of carrying on the war. Con- 
gress, therefore, appealed to the states to ward off the danger that 
threatened their common cause by liberal cessions of lands for 
their common benefit,^-^ On October lo, 1780, Congress passed 
a resolution which contained a pledge on the part of Congress 
(i) that the western territory ceded to the states should be disposed 
of for the common benefit of all the states; (2) that it should be 
formed into states to be admitted, when formed, into the Union 
upon a footing equal in all respects with that of the original states; 
(3) that the expenses incurred by any state in subduing British 
posts and in acquiring and defending the territory to be ceded 
should be reimbursed; (4) that the manner and condition of the 
sale of the said lands should be exclusively regulated by Con- 
gress .^^^ 

122 History of Ohio, Chase; Statutes of Ohio, Vol. I. 
^^ Journals of Congress, Yl, Tpp- ^79~i-So. 
i^ Journals of Congress, VI, p. 213. 



FEDERAL SOURCES OF SCHOOL FUNDS 43 

New York was the first of the states to give up her claim, doing 
so on March i, 1781.^^^ Virginia ceded hers October 20, 1783;^^** 
states Cede Claims Massachusetts, hers April 19, 1785.1^'^ Connecti- 
to Western Lands ^^^,^ g^.^^ cession was made September 14, 1786.^28 

Massachusetts and New York made no reservations in their ces- 
sions, but Virginia reserved for herself about three million, seven 
hundred ten thousand acres of land known as the Virginia Military 
Reservation, lying in Ohio between the Scioto and Little Miami 
rivers on the northwest side of the Ohio river, for the benefit of 
her troops.^^*^ Connecticut reserved for herself an area of about 
three million, three hundred thousand acres lying in the north- 
eastern corner of Ohio, known as the Western Reserve or New 
Connecticut.^"" Without waiting for Connecticut's cession of her 
claims Congress had provided by an ordinance passed in May, 1785, 
for the survey and sale of its public domain lying in the West. 
Two ineffective attempts to settle the western territory prior to 
1785 deserve attention because of their plans to provide for the 
Early Plans to Support of education. In 1783, Rufus Putnam, 

Settle Western Col. Timothy Pickering and other New Ens- 
Territory and J t, fc> 

Secure Educational landers undertook to form a new state for Ameri- 

Land Grants. 1 1 ■ r -t /-t^t 

New England Can veteran soldiers and their families. The state 

was to be located between the Ohio river and Lake 
Erie. Colonel Pickering drew up a plan of government and Put- 
nam prepared a petition to Congress for permission to plant a 
colony. The importance of this petition is that it contains the 
first suggestion of a policy of federal land reservation for the sup- 
port of education. 

In the same year, 1783, Colonel Bland of Virginia made a motion 
Plan of in Congress to accept Virginia's cession of western 

Colonel Bland j^j^^jg ^^ ^^^ ^^^^^ offered by the state. In this 

motion it was proposed that the land thus ceded should be laid 

125 Journals of Congress, VII, pp. 46-48. 

120 Journals of Congress, IX, pp. 67-70. 

127 Acts and Laws of Mass., 1783-Sg, pp. 218, 273-274. 

12'* Journals of Congress, XI, pp. 221-223. 

120 Encyclopedia Briltanica, Vol. XVII, p. 758. 

130 Report Conn. Board of Education, 1853, p. 63. 



44 PERMANENT COMMON SCHOOL FUNDS 

out in definite districts, each of which was to become a state as 
soon as it contained twenty thousand inhabitants. In these dis- 
tricts bounty lands were to be given to continental soldiers. The 
motion further provided that Congress should reserve one-tenth 
of the territory and appropriate the income derived from the sale to 
several specific objects, one of which was the founding of semi- 
naries of learning.^^^ 

As noted above, after Virginia had ceded her claim to the western 
territory, the federal possession of the western lands was considered 
Thos. Jefferson's assured. Congress therefore felt called upon to 
^^^° consider plans for their survey, sale and govern- 

ment. Thomas Jefferson prepared a plan for the government of 
this western territory. His plan was adopted April 23, 1784. It 
contained no provision for the support of education. This plan, 
however, was intended for the temporary government only. 

On May 20, 1785, Congress adopted an ordinance which pro- 
Ordinance of 1785. vided the manner of survey and of sale of the 
Gr^ts of SecWon western lands. The ordinance reads in part as 

Sixteen for Schools f qUowc • 

"An ordinance for Ascertaining the Mode of Disposing of Lands in the 
Western Territory. 

"Be it ordained by the United States in Congress assembled, That the 
territory ceded by the individual states, to the United States, which has been 
purchased of the Indian inhabitants shall be disposed of in the following 
manner: A surveyor from each state shall be appointed by Congress or a 
committee of the states, who shall take an oath for the faithful discharge of 
his duty, before the geographer of the United States, who is hereby empowered 
and directed to administer the same; and a like oath shall be administered to 
each chain carrier by the surveyor under whom he acts. 

"The surveyors . . . shall proceed to di\'ide the said territory into town- 
ships of six miles square, by lines running due north and south, and others 
crossing these at right angles, as near as may be. 

"The geographer shall designate the townships or fractional parts of the 

131 George W. Knight, History and Management of Land Grants for Education 
in the Northwest, p. 8 (Apud I, Bancroft, Appendix). 



FEDERAL SOURCES OF SCHOOL FUNDS 45 

townships by numbers progressively from south to north; always beginning 
each range with No. i. . . . 

". . . . The townships respectively shall be marked by subdivisions into 
lots of one mile square, or 640 acres, in the same direction as the external lines 
and numbered from i to 36." 

Here follow provisions regarding the mode of sale; one of which 
reads: 

"There shall be reserved for the United States out of every township, the 
four lots being numbered 8, 11, 26, 29 . . . for future sale. There shall 
be reserved the lot No. 16, of every township, for the maintenance of public 
schools within the said township." 1^3 

The adoption by Congress of the plan contained in the ordinance 

of 1785 cut short the dreams of the company headed by Colonel 

Pickering and Rufus Putnam. Nevertheless, 

Ordinance of 1787 ^ ' 

and the Ohio Putnam and Beniamin Tupper orsfanized a new 

Company , rr o 

company, known as the Ohio Company, with pur- 
poses quite similar to those of the old New England company. On 
July 5, 1787, Manasseh Cutler, one of the directors of the Ohio 
Company, arrived in New York where Congress was in session, 
and opened negotiations in behalf of the Ohio Company for the 
purchase of a large tract of land. The prospect of such a large 
sale made it incumbent upon Congress to make further provision 
for the government of the western territory. The Journals of 
Congress, which record the passing of this ordinance, read as 
follc.vs: 

"A/'cording to order, the ordinance for the government of the territory 
of ti - United States northwest of the River Ohio was read a third time and 
passed as follows: 

"An ordinance for the Government of the Territory of the United States, 
North West of the River Ohio." 

This is a long ordinance covering nine pages and providing for 
the government of this region. Pages 90-93 read in part as follows : 

"It is hereby ordained and declared by the authority aforesaid, that the 
folio-Rang (six) articles shall be considered as articles of compact between 

^^ Laws of United States of America, 1789-1815, Vol. I, Chap. 32, pp. 563-569. 



\ 



46 PERMANENT COMMON SCHOOL FUNDS 

the original states and the people and states in the said territory, and forever 
remain unalterable, unless by common consent, to wit: 

"Article the first. . . . 

"Article the second. . . . 

"Article the third. Religion, morality and knowledge, being necessar}' to 
good government and the happiness of mankind, schools and the means of 
education shall forever be encouraged. . . . " i^s 

The rest of this article is taken up with provisions regarding the 
Indians. The original ordinance makes no reservation of lands 
for education, but in the contracts for the sale of lands made there- 
after, lot i6 was set aside in each township for schools and two 
townships for a university- 
It will be seen that this ordinance of 17 87 contains no general 
nor specific provision for the reservation of lands for education. 
Ordinance of 1787 Article III, frequently quoted as the source of our 
Fedeiaf L^nd'° °^ national land policy, might mean much, little or 
Grants for Schools nothing. The benevolent school land policy 
adopted by Congress, and which has frequently and erroneously 
been attributed to this ordinance, cannot be found here. Indeed, 
the action of Congress during the next ten days would seem to 
indicate that it deserved little of the praise which has ever since 
been heaped upon it. The ordinance of 1785 and the contract 
for the sale of western territory are the two instruments out of 
which the federal policy of reserving lands for educational insti- 
tutions arose. 

The Ohio Company originally asked for the following reserva- 
tions, i. e., gifts of land from Congress: one lot in each township 
Federal Land ^^^ ^he support of schools, one for the ministry, 

Schoois^anT ^°^ ^^^^^ townships for the support of an institution 
Religion in Ohio Qf higher learning. Congress obiected to these 

Company's o o o j 

Contract 1787 demands and did not come to terms until Dr. 

Cutler submitted an ultimatum. In this he repeated the original 
demands of the Ohio Company, save that he now asked for two 
instead of four townships for an institution of higher education. 
Cutler's threat to buy lands of some individual state, added to 

133 Ibid., 17S7, p. 90; Ibid., pp. 221 ff. 



FEDERAL SOURCES OF SCHOOL FUNDS 47 

Congress' pressing need for money, resulted in the passage of an 
ordinance which authorized the board of treasury to contract for 
the sale of lands on the terms and with the reservations demanded 
by the company. This ordinance was passed July 23, 1787. Four 
days later it was modified slightly upon the insistence of Dr. Cutler. 
As passed on July 23, it reads in part as follows: 

"Powers to the board of treasuiy to contract for the sale of western terri- 
toiy." 

(It is provided,) 

"That the Board of Treasury be authorized and empowered to contract 
with any person or persons for a grant of a tract of land . . . upon the 
following terms . . .: The purchaser or purchasers, within seven years 
from the completion of this work, to lay off the whole tract at their own ex- 
pense into townships and fractional parts of townships, and to divide the same 
into lots, according to the land ordinance of the 20th of May, 1785; 

"(i) Complete returns whereof to be made to the Treasury Board. The 
lot No. 16, in each township or fractional part of a township, to be given 
perpetually for a purpose contained in the said ordinance. The lot No. 29 
in each township or fractional part of a township, to be given perpetually for 
the purposes of religion. 

"(2) The lots Nos. 8, 11 and 26, in each township or fractional part of a 
township, to be reserved for the future disposition of Congress. Not more 
than two complete townships to be given perpetually for the purposes of an 
university, to be laid off by the purchaser or purchasers as near the center 
as may be, so that the same shall be of good land, to be applied to the in- 
tended object by the legislature of the state. The price to be not less than one 
dollar per acre for the contents of the said tract, excepting the reservations 
and gifts aforesaid." i^* 

The next large purchase of land was made by John Cleve 

Symmes, who, in the year 1787, made a contract with the board of 

treasury which later resulted in a purchase of over 

Reservations for three hundred eleven thousand (^11,682) acres of 

Schools and . . \o f / 

Religion in Symmes' land in Ohio.^^^ Symmes' contract reserved lands 
for schools, religion, and one township for an insti- 
tution of higher education. 

134 United States Land Laws, 1838, pp. 24-2^. 

135 " Educational Land Policy of the United Stales," Barnard's American Journal 
of Education, Vol. 28, pp. 929-938. 



48 PERMANENT COMMON SCHOOL FUNDS 

Lot 29 for the support of the ministry was granted by the United 
States in no instances except in land purchased by the Ohio Com- 
pany and by Symmes. 

The figures given below show the method of surveying lands in 
conformity with the provisions of the ordinance of 1785. The 
Congressional lands surveyed are divided into townships six miles 

and R^seivSn^of Square. It will be seen that for the boundaries 
School Sections q£ ^-j^g townships, north-and-south and east-and- 
west lines must be secured. In order to get a point from which to 
start these lines it is necessary to designate certain meridians as 
principal meridians, and certain parallels as base-lines. A meridian- 
line is an arbitrary line selected by the surveyor and may be any- 
where in the state. In some states we find several principal me- 
ridians, in others only one. Beginning with any principal meridian 
the townships are numbered east and west from it by tiers, the 
first tier east being called range one, east; and the first tier west 
being called range one, west. The townships are numbered in 
the same manner both north and south from the base line. Any 
township may, therefore, be easily described and located, thus: 
Township 3 N., Range 2 W. of the first principal meridian. Owing 
to the convergence of meridians the townships become narrower as 
one proceeds northward from the base-line. It therefore becomes 
necessary to run correction lines to be used as new base-lines. 
Each township is supposed to be six miles square and is divided 
into thirty-six sections, numbered as in figure 2. Each section 
contains six hundred forty acres. Figures i and 2 show the method 
of surveying and the division of the township into sections. 

It might be well to point out some of the more important forces 
which originally influenced Congress in making reservations of 
Causes of Federal ^^^^ for schools. These forces may be summa- 
Land Grant Policy j-j^gj ^s follows: (i) the example set by states, 
such as Connecticut and Massachusetts and others, of reserving 
sections for schools in newly surveyed townships, (2) interest in 
the cause of education, (3) the need of selling the western lands, (4) 
the desire to make westward emigration attractive. Massachu- 
setts, in 1788, for the sake of encouraging settlement in her eastern 



FEDERAL SOURCES OF SCHOOL FUNDS 



49 



territory, had provided for the reservation of school lands. In 
Chapter II it was pointed out what Connecticut and New York did 









I 


^IGU] 


x% 1 
















7 


s 












6 










Cm 


reetio 


5 


^ 


Line 












k 


.a, 










3 


<£; 


\ 










2 




I 


1 


TV 


in 


II 


I 
B.I 

W. 


n.i 

E. 


II 


III IV 



Bass. 



Line 



Figure 2. — Six Miles Square. 



6 


5 


4 


3 


2 


1 


7 


8 


9 


10 


11 


12 


18 


17 


16 


15 


14 


13 


19 


20 


21 


22 


23 


24 


30 


29 


28 


27 


26 


25 


31 


32 


33 


34 


35 


36 



Figure 3.— One 
Mile Square. 



NWM 


N3^NEM 




SEM 
NEJ4 


S.K 



in this same direction. The efforts of the original states to provide 
schools, which have been described, suggest something of the public 
interest respecting education. Nevertheless it must be admitted 



50 PERMANENT COMMON SCHOOL FUNDS 

that, although in certani localities and with certain individuals, 
free education was regarded as necessary for the commonwealths, 
there was a long perioci of struggle and experimentation to be 
passed through, before the public mind was ready to accept the 
principle underlying the establishment of free schools. Certain 
men in Congress in 1785 and 1787 were deeply interested in the 
cause of public education. On the other hand, it must be evident 
from the difficulties which Dr. Cutler experienced in obtaining his 
demands, that it was the need of selling tlie western lands which led 
Congress to make the reservations for schools and universities. 
Emigration westward had been slow and Congress had become 
discouraged. It was for the sake of otTering an offset to the hard- 
ships of the wilderness that Congress consented to make provision 
for schools. 

The reservation of sections for common schools arose out of the 
ordinance of 17 85. The land reservation which arose from the 

ordinance of 1787 is the reservation of townships 
Ushed^ty*Oniilmn- ^o^ the benefit of an institution of higher learning, 
ces of 1785 and ]\;]-q general policy was declared or provided for 

in cither of these ordinances. The educational 
provisions of the land ordinances and of the powers of the treasury 
were purely specific in their application. The second related only. 
to the territory ceded by individual states and purchased by the 
United States of the Indians; the first only to the sale of land made 
to the Ohio Company .^^"^ Nevertheless, the principle which had 
been expressed in the ordinance of 1785 and in the sale contracts of 
1787 became a precedent for the federal Government, and in every 
public-land state admitted into the Union at least one section in 
every township, or an equivalent in land or scrip, has been granted 
for the use of schools, and at least two townships for an institution 
of higher learning. Ohio received three townships for an institution 
of higher learning; Florida, Minnesota, and Wisconsin, four each; 
and Utah seven.^^^ 

136 Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report of U. S. Commissioner of Education, 1S92-93, p. 1270. 

137 Report of U. S. Commissioner of Education, 1S67-6S, p. 6S. 



FEDERAL SOURCES OF SCHOOL FUNDS 51 

Tennessee was the first state to be admitted into the Union in 

which the federal Government owned lands. But no federal grant 

of lands for schools was made to this state until 

First State to 

Receive Section 1806, ten years after its admission. Consequently 

Sixteen, Ohio, 1802 , ^ . , . , . . 

the first state in which section sixteen was granted 
for the support of schools was Ohio. The grant originally offered 
to her in the enabling act of 1802 reads as follows: 

"An act to enable the people of the eastern division of the territory north- 
west of the River Oliio, to form a constitution and state government, and for 
the admission of such into the Union, on an equal footing with the original 
states, and for other purposes. 

"Sec. I. Be it enacted, etc. ... 

"Sec. 7. That the following propositions be and the same are hereby 
offered to the convention of the eastern state of the said territory when formed, 
for their free acceptance or rejection; which, if accepted by the convention, 
shall be obligatoiy upon the United States. 

"First. That the section numbered sixteen in every township, and where 
such section has been sold, granted or disposed of, other lands equivalent 
thereto, and most contiguous to the same shall be granted to the inhabitants 
of such township for the use of schools. 

"Second. That [certain salt springs and lands be granted to the state] for 
the use of the people thereof, the same to be used under such terms . . . 
and regulations as the legislature of the said state shall direct. . . . 

"Third. [That one-twentieth part of the net proceeds of the lands lying 
within the said state sold by Congress from and after June 30, 1802, be] ap- 
plied to laying out and making public roads. 

"Provided always, that the three foregoing propositions herein offered are 
on the condition that the convention of the said state shall provide by an 
ordinance, irrevocable without the consent of the United States, that every 
and each tract of land sold by Congress, from and after the 30th day of June 
next, shall be and remain exempt from any tax laid by order, or under au- 
thority of the state, whether for state, county, township, or any other purpose 
whatever, for the term of five years, from and after the day of sale." i^s 

It will be seen from the above quotation that Congress offered 
to the people of the state about to be formed, certain grants of 
land including section sixteen, salt lands and a certain per centum 
of the net proceeds of the land sold by Congress after the admission 
of the state. These propositions were offered upon cci "^ain stated 

138 Laws of the United States of America, 1789-1815, Chap. 300, pp. 496-498. 



52 PERMANENT COMMON SCHOOL FUNDS 

conditions, viz., that the lands sold by Congress should be free 
from all state, county, and township taxes. The grant made in the 
above act provided no school lands for a large portion of the state. 

Over eleven million acres of land within Ohio, more than one- 
fourth of the land area of the state, were included in the Ohio 
Company's purdiase, the Symmes purchase, the 
Original Grant Virginia Military Reserve, the Connecticut West- 
ern Reserve, the United States Military Reserva- 
tion, and miscellaneous grants made by the federal Government 
to corporations, individuals, and Ohio. The grant of the section 
numbered sixteen to the inhabitants of each township did not 
apply to these lands. Over seven million acres of land in Ohio, 
exclusive of Virginia's Military Reservation, one-third of the state, 
was totally unprovided for, while the remainder was given one 
thirty-sixth of the land owned by the United States, to aid in sup- 
porting public schools. It was not to be expected that the people 
of Ohio would be satisfied to accept propositions manifestly so in- 
equitable.* Of all these reservations, grants, and sales, the sales 
to the Ohio Company and to Symmes, together equal to about 
1,200,000 acres, were the only ones in which section sixteen or other 
sections had been reserved for schools. Consequently there were 
more than nine million acres within the state in which no school 
lands had been reserved.^^^ 

The constitutional convention of Ohio passed an ordinance and 
resolution on November 29, 1802, making provision for the grant 
of school lands to those sections of the state which had been left 
unprovided for. 

Congress, by an act passed March 3, 1803, accepted the "Modi- 
fications and additions" proposed by Ohio and admitted Ohio as a 
state. As a result of this act land equal approximately to one 
thirty-sixth their area was granted for schools to all portions of 
the state not affected by the sixteenth section grant. 

* For a fuller description of the areas not included under the sixteenth section 
grant and for an account of the school lands subsequently granted for them, consult 
account of Ohio Irreducible Debt, Part II, Chapter XLIII. 

139 Barnard, Anier. Jour, of Ed., Vol. 28, p. 933; Chase, Statutes of Ohio, pp. 74-75. 



FEDERAL SOURCES OF SCHOOL FUNDS 



S3 



The question involved in the Ohio controversy was a far-reaching 
Congress Makes one and One which might be met with upon the 
for^Grant 0°^'^'°° admission of a state wherein lands had been set- 
Lieu°of^s^e^tfo? ^led upon, which, upon survey, proved to fall 
^^^•^^^^ within section sixteen. 

In 1826 Congress, by an act entitled "An act to appropriate 
lands for the support of schools in certain townships and fractional 
townships, not before provided for," made general provision for 
all such cases. Section one of this act provided that: 

"There shall be reserved and appropriated, for the use of schools in each 
entire township, or fractional township, for which no land has heretofore been 
appropriated or granted for that purpose, the following quantities of land, 
to-wit, for each township or fractional township containing a greater quantity 
of land than three-quarters of an entire township, one section; for a fractional 
township containing a greater quantity of land than one-half, and not more 
than three-quarters of a township, three-quarters of a section; for a fractional 
township containing a greater quantity of land than one-quarter, and not more 
than one-half of a township, one-half section; and for a fractional township 
containing a greater quantity of land than one entire section and not more 
than one-quarter of a township, one-quarter section of land." 1*0 

The policy which Congress had adopted of granting lands for 
schools to the Northwest Territory was soon extended to the South. 
Congressional On December 27, 1789, North Carolina had ceded 

Policy Expended ^^ the United States the sovereignty and territory 
South, 1803 Qf ^YY lands within the present limits of Tennessee. 

In 1796 Tennessee was admitted into the Union, but the federal 
Govermnent retained the title to the public lands within the new 
state, and it was not until 1806 that Tennessee received a grant 
of public lands. Between 1796 and 1806 much of the public 
land had been taken up by settlers. In this latter year the United 
States granted to Tennessee the public lands lying within the state 
on which the Indian title had become extinct.^'^^ Thereupon, the 
state passed an act requiring that newly acquired lands should be 
surveyed and laid out " so as to form sections as near six miles square 

I'lo Statutes at Large, Vol. IV, p. 179. 

1*1 Report Tenn. Supt. Public Instruction, 1S91, pp. 24-26; Laws of Tenn., 
1806, Chap. I, Sees. i-6. 



54 PERMANENT COMMON SCHOOL FUNDS 

as the case will admit" and that six hundred forty acres fit for 
cultivation should be laid off in each such six mile square division 
and "appropriated for the use of schools for the instruction of 
children forever." It will be seen that the policy pursued with 
respect to Tennessee differed from that pursued with the western 
states, in wdiich school sections were reserved throughout the entire 
area during the territorial period and granted to the state upon its 
admission to the Union. 

From this time until 1848, in every newly surveyed congressional 

township, one section was granted for the support of schools. 

In 1846 the commissioner of the land oflQce, and 

Two Sections ,0 r 1 rr-. 

Granted for Com- m 1 847 the Secretary of the Treasury had each 

mon Schools, 1848 , , . , , r 1 1 1 1 

recommended an mcr eased grant of school lands 
to the new states and territories. In the first session of the thirteenth 
congress, February 15, 1848, when the question was being put on 
the passage of the bill concerning the admission of Wisconsin into 
the Union, John A. Rockwell, a member of the house of representa- 
tives, from Connecticut, moved an amendment granting section 
thirty-six in each township in addition to section sixteen for schools. 
This amendment was rejected by a vote of eighty to fifty-eight. 
In the act establishing the territorial government for Oregon in 
August, 1848, and in the act for IMinnesota, approved March 2, 
1849,^"^ it was provided that sections numbered sixteen and thirty- 
six of each township should be reserved for the use of schools. 
The Oregon act reads : 

"An Act to Establish the Territorial Government of Oregon. Approved 
August 14, 1848. 

"Sec. 20. That when the lands in the said Territory shall be surveyed 
under the direction of the Government of the United States, preparatory to 
bringing the same into market, sections numbered 16 and 36 in each township 
in said Territory shall be, and the same are hereby, reserv'ed for the purpose 
of being applied to schools in said Territory, and in the States and Territories 
hereafter to be erected out of the same." ^^ 

This was the first act appropriating two sections for the support 

1^ An Act to establish the territorial government of Minnesota, Sec. 18; Statutes 
of Minnesota, 1849-58, p. xl. 
^*3 Statutes at Large, Vol. IX, p. 330. 



FEDERAL SOURCES OF SCHOOL FUNDS 55 

of schools. The first state to receive two sections of each township 
was Cahfornia, admitted September 9, 1850; the second, Minnesota, 
admitted May 11, 1858; the third, Oregon, admitted February 14, 
1859. 

While Congress had been bestowing millions of acres of lands 
upon every new public land state, with the exception of Virginia, 
Vain Efforts of Connecticut and Tennessee, it had done nothing 
to'^Secure^Land ^^r any of the original states or the states carved 
^^^^^^ out of them. Yet by the resolution of 1780, 

already referred to, Congress had given its pledge that the western 
lands should be disposed of for the benefit of all. It is not sur- 
prising, therefore, that some of the eleven original states unprovided 
with federal lands, should have made an earnest effort to secure 
some of them. 

In 1 82 1 Maryland passed resolutions stating that all of the states 
had equal rights in the public lands, and that those for whom no 
appropriations had been made were entitled to such appropriations. 
The resolutions read as follows : 

"Resolved, by the general assembly of Maryland, That each of the United 
States has an equal right to participate in the benefit of the public lands, the 
common property of the Union. 

"Resolved, That the States in whose favor Congress have not made- ap- 
propriations of land for the purpose of education, are entitled to such ap- 
propriations as will correspond, in a just proportion, with those heretofore 
made in favor of the other States." ^^ 

Copies of these resolutions were transmitted to Congress and 
to the governors of the several states with a request that they sub- 
mit them to their respective legislatures. 

Governor Hester of Pennsylvania, in 1821, urged the legislature 
of his state to consider the question of uniting with other of the 
original states in demanding of the federal Government an equitable 
proportion of the public lands for the support of schools.^"^ Con- 
necticut, New Hampshire, Vermont, and Virginia indorsed Mary- 
lands' resolutions. Massachusetts reported unfavorably upon them. 

1*4 Report U. S. Commissioner of Education, 1892-93, Vol. II, p. 1274, 
1*5 J. p. Wickersham, History of Education in Pennsylvania, p. 268, 



50 



PER^IANENT COMMON SCHOOL FUNDS 



New York drew up and accepted a counter report. Ohio adopted 
"a long and carefully prepared reply." Here the matter ended."*^ 

The states in which section sixteen was not reserved for schools 
are as follows: The thirteen original states, Indian Territory 
(admitted with Oklahoma in 1907), Kentucky, 
Receiving Section Maine, Tennessee, Texas, Vermont, and West 
Virginia. Kentucky, Maine, Vermont, and West 
Virginia, like the thirteen original states, contained no public land. 
The case of Tennessee has been explained in a preceding para- 
graph. The Republic of Texas retained the title to her public 
lands upon her admission into the Union. On July 26, 1839, she 
had provided for a reservation of three Spanish leagues, thirteen 
thousand two hundred and eighty-four acres in each county for the 
support of schools. In 1840 this county grant was increased to 
four leagues, or 17,712 acres. Owing to these two facts Congress 
was neither able nor called upon to grant lands to Texas for the 
support of schools, and, as pointed out in Chapter I, of this part, 
Texas to-day possesses the largest permanent fund of any state 
in the Union.* All the land in Indian Territory belonged to 
members of Indian tribes, and Congress had no authority to reserve 
any of it for schools. In place of the usual grant of land Congress 
appropriated five million dollars which became a part of the per- 
manent school fund upon the territory's admission into the Union 
with Oklahoma.! 

Table X presents the states which received no federal grants or 
appropriations for common schools. 

Table XI shows the area of the land reserved by Congress in the 
states in which section sixteen or sections sixteen and thirty-six 
in each township were donated for common schools. The areas 
given here are taken from the tables last published by the federal 
land office, issued in 1896. The areas are evidently estimates. 
In the separate accounts in Part III will be found statements of 

* Cf. separate accounts given for each of these states in Part II, 
t Letter to F. H. Swift, September 13, 1906, from Fred L. Warner, Secretary 
of (Oklahoma) Board for Leasing School Lands, 
we Bernard C. Steiner, History of Education in Maryland, pp, 56-57. 



FEDERAL SOURCES OF SCHOOL FUNDS 



57 



the area each state actually received, where this has been ascer- 
tainable. Some states have not yet completed the survey of their 
lands and in others the area reported from year to year varies. In 
view of these and certain other facts it seems best to abide here 
by the area given in the federal tables which, though subject to 
modification, will answer sufficiently for a general comparison. 



Table X. States Which Received no Federal Grants for Common Schools 



Thirleen Original Slates 



A dmitied 



Connecticut 

Delaware 

Georgia 

Maryland 

Massachusetts 



New Hampshire 
New Jersey 
New York 
N. Carolina 



Pennsylvania 
Rhode Island 
S. Carolina 
Virginia 



Vermont 1791 

Kentucky 1792 

Maine 1820 

W. Virginia .... 1863 

Texas 1845 



Table XI. Area of Township Sections Granted for Common Schools * 
Group I. States Receiving Section No. 16 



Acres 



Date of Grant 



Alabama 901,725 

Arkansas 928,057 

Florida i>o53i653 

Illinois 985,141 

Indiana 601,049 

Iowa 978,578 

Louisiana 798,085 

Michigan 1,003,573 

Mississippi 838,329 

Missouri 1,162,137 

Ohio 710,610 

Wisconsin _ 958,649 



Mar. 3, 1803 

June 23, 1836 

Mar. 3, 1845 

Apr. 18, 1818 

Apr. 19, 1816 

Mar. 3, 1845 

Apr. 21, 1806; Feb. 15, 1843 

June 23, 1836 

Mar. 3, 1803; May ig, 1852; 

Mar. 3, 1857 

Mar. 6, 1820 

Mar. 3, 1803 

Aug. 6, 1846 



* Taken from p. 4, Tables of Stale Grants of Public Lands, issued by federal 
land office, March 12, i8g6. G. F. Pollock, acting commissioner, stated in 
letter, August 27, 1906, that no tables of stale land grants had been compiled 
since 1896. 

<^ From Report of U. S. Commissioner of Education, 1892-93, II, p. 1283. 



58 PERMANENT COMMON SCHOOL FUNDS 

Group II. Territories and States Receiving Sections Nos. i6 and 36 



Acres 



Date of Grant 



Arizona 4,050,346 

California 5,610,702 

Colorado 3>7i5,555 

Idaho 3,063,271 

Kansas 2,876,124 

Minnesota 2,969,991 

Montana 5,102,107 

Nebraska 2,637,155 

Nevada (3,985,422) 2,ooo,ooot 

New Mexico 4,309,369 

North Dakota 2,531,200 

Oklahoma 1,276,204 

Oregon 3,387,520 

South Dakota 2,813,511 

Washington 2,488,675 

Wyoming 3,368,924 



May 
Mar. 
Mar. 
Mar. 
Jan. 
Feb. 
Feb. 
Apr. 
Mar. 
Sept. 
Mar. 



26, 1864 

3, 1853 

3> 1875 

3, 1863 

29, 1861 

26, 1857 

28, 1861 

19, 1864 

21, 1864 

9, 1850 

2, 1861 



Feb. 14, 1859 
Mar. 2, 1861 
Mar. 2, 1853 
July 25, 1868 



Group III. State Receiving Sections Nos. 2, 16, 32, and 36 



Acres 



Date of Grant 



Utah 



6,007,182 Sept. 9, 1850 



Salt Lands 



Group IV. Indian Territory received $5,000,000 grant from Congress in lieu of 
the usual land donations. See account given above and in Part II. Texas and 
Tennessee also present special cases. 

Of all federal lands which have been employed by the states to 
establish permanent common school funds, the sixteenth and 

thirty-sixth sections have contributed the most. 

However, no inconsiderable portion of these funds 
has been derived from lands gained from grants, given, in many 
instances, for particular objects other than schools but under such 
terms that it was possible for the state to devote the proceeds to 

t In place of this original congressional grant Nevada accepted 2,000,000 acres 
of land, with the privilege of selecting any unappropriated lands whether lying 
within sections 16 and 36 or not. {Report Nevada State Land Register, 1905, 
1906, pp. 8, 14.) 



FEDERAL SOURCES OF SCHOOL FUNDS 



59 



education. In other cases Congress has simply granted lands 
without specifying the object to which they were to be devoted. 
In granting Ohio salt lands and a certain per centum of the proceeds 
of the public lands sold after the state's admission into the Union, 
Congress provided two sources of money which have contributed 
to permanent common school funds in many states. 

According to the last federal tables, thirteen states have received 

grants of salt and contiguous lands, commonly spoken of as 

saline lands, the total area of which amounts to 

States Devoting 

Saline Lands to 606,04 ^ acres.^'*' Arkansas, Indiana, Missouri,^^* 

School Funds , "J, . , ,. ' , ' 

and Ohio are among the states which have devoted 
the proceeds of saline lands to their permanent common school 
funds. The acreage of saline lands granted to these five states is 
as follows: Ohio, 24,216 acres; Indiana, 23,040 acres; Arkansas, 
46,080;^^^ Missouri and Nebraska ^^° each 46,080. 

Ohio, the first state to receive the grant of saline lands has made 

the proceeds of them a part of the Irreducible 

Ohio Saline Lands _, ,., ii-ii- 

Debt, which she established m place of creating 
a permanent common school fund.^^^ 

A congressional act enabling the territory of Indiana to form a 
constitution, granted to the state all salt springs within the terri- 
indiana Saline tory and land reserved for the use of the same with 
^^^^ such other land as the President of the United 

States may deem necessary for the proper working of the salt 
springs, not exceeding thirty-six sections.^^^ In 1832 the legislature 
of Indiana petitioned Congress for permission to sell these lands. 
Congress granted the request upon two conditions: (i) that the 
land be sold at not less than one dollar and twenty-five cents per 

1*7 Tables. State Land Grants of Public Lands, Gen. Land Office, March 12, 
1896, p. 8. 

1*8 Laws of Missouri, 1837, Act passed Feb. 6. 

1*9 Answers returned Sept. 7, 1906, by John Hineman, Ark. State Supt. Public 
Instruction. 

150 Data furnished Sept. i, 1906, by Neb. Supt. Pub. Inst. 

161 Ohio School Law, 1898, Sec. 3952. See also account of Ohio fund given in 
Part II. 

iM Boone, R. G., History of Education in Indiana, p. 181. 



6o PERMANENT COMMON SCHOOL FUNDS 

acre; (2) that the proceeds be applied to education. By a special 
Act, 1834, the proceeds of the saline lands were regarded as a per- 
manent fund known as the Saline Fund, the income of which was 
devoted to schools. In 1851, the Sahne Fund became a part of 
the Common School Fund by the provisions of the new constitu- 
tion. The total proceeds of the saline lands were $89,478.47. 

By reference to the Ohio Enabling Act, quoted above, it will be 
seen that in the case of Ohio, Congress left it to the option of the 
state to determine what use should be made of the proceeds of the 
sahne lands. But in the case of Indiana, although at first Congress 
appears not to have specified the object, yet when the state applied 
for the right to sell these lands. Congress required that their pro- 
ceeds should be devoted to education. This illustrates a general 
tendency evident in the acts of Congress with respect to lands 
granted to the states. At first it was left largely to the state to 
determine the mode of disposing of these lands, and the objects 
to which their proceeds were to be devoted, but as time went on the 
provisions of Congress became more and more specific and ex- 
acting. 

In 1 841 Congress passed an act granting five himdred thousand 
acres of land to each of the following states : Alabama, Arkansas, II- 
internai Improve- hnois, Indiana, Louisiana, Michigan, Mississippi, 
ment Lands ^^^^ Missouri for internal improvement. The ob- 

jects to which the act empowered the states to apply the net pro- 
ceeds of the sales of these lands were as follows: roads, rail- 
ways, bridges, canals, improvement of waterways, and drainage of 
swamps. The lands were granted on condition that the states 
should grant free transportation for United States mail, United 
States troops, and war supplies. The act provided that similar 
land grants should be extended to all states admitted subsequently 
to the passage of the act. The act reads: 

"An act to appropriate the proceeds of the sales of the public lands and to 
grant preemption rights. 

"Sec. 8. And be it further enacted, 

"That there shall be granted to each state specified in the first section of 
this act five hundred thousand acres of land for purposes of internal improve-' 



FEDERAL SOURCES OF SCHOOL FUNDS 6i 

ment. Provided, that to each of the said states which has already received 
grants for said purposes, there is hereby granted no more than a quantity of 
land which shall, together with the amount such state has already received 
as aforesaid, make five hundred thousand acres, the selections in all of the 
said states to be made within their limits respectively, in such manner as the 
legislature thereof shall direct; and located in parcels conformably to sectional 
divisions and subdivisions, of not less than three hundred twenty acres in 
any one location, on any public land except such as is or may be reserved 
from sale by any law of Congress or proclamation of the President of the 
United States, which said locations may be made at any time after the lands 
of the United States in said states respectively, shall have been surveyed 
according to existing laws. And there shall be and hereby is, granted to each 
new state that shall be hereafter admitted into the Union, upon such admis- 
sion, so nauch land as, including such quantity as may have been granted to 
such state before its admission, and while under a territorial government, 
for purposes of internal improvement as aforesaid, as shall make five hundred 
thousand acres of land, to be selected and located as aforesaid. 

"Sec. g. And be it further enacted, 

"That the lands herein granted to the states above named shall not be 
disposed of at a price less than one dollar and twenty-five cents per acre, until 
otherwise authorized by a law of the United States, and the net proceeds of 
the sales of said lands shall be faithfully appKed to objects of internal im- 
provement within the states aforesaid, respectively, namely: Roads, railways, 
bridges, canals and improvements of water courses and drainage of swamps, 
when made or improved shall be free for the transportation of the United 
States mail, and ipunitions of war, and for the passage of their troops, without 
the payment of any toll whatever." ^^^ 

Nineteen states have received grants of land under the Act of 

1841, amounting to nine million five hundred thousand acres of 

land.^^'^ Five, at least, have devoted internal 

States Devoting 

Internal Improve- improvement lands to the permanent common 

ment Lands to iiri^i-r- 

Permanent School school fund. California regarded the sixteenth 
and thirty-sixth section lands as belonging to the 
townships ^^^ and created her first permanent state fund for the 
support of common schools from the proceeds of the sales of the 
live hundred thousand acres of internal improvement lands which 
the state received upon her admission into the Union in 1850. 

153 U. S. Statutes at Large, Vol. V, Chap. 16, approved Sept. 4, 1841. 

154 Report Cal. State Supt. Public Instruction, 1864-65, p. 249. 



62 PERMANENT COMMON SCHOOL FUNDS 

Iowa in 1846/^^ Wisconsin in 1849/^^ Oregon in 1859,^^' Kansas 
in 1861,^^® and Nevada in 1864,^^^ each by its constitution adopted 
in years just named, united its internal improvement lands with 
the township section lands in the establishment of a permanent 
common school fund managed by the state. Kansas, however, 
failed to enact laws to carry out the provisions of her constitution 
respecting these lands, so that their proceeds were never added to 
the state permanent school fund.^'^^ 

As early as 1825, North Carolina created a permanent common 

school fund, known as the Literary Fund. Among the several 

sources named from which this fund was to be 

Swamp Lands , . 1 • i i i n .1 

derived, were mcluded all vacant unappropriated 
swamp lands in the state. It need scarcely be stated that these 
were state and not federal lands. By an Act of Congress passed in 
1850, supplemented by later legislation, swamp lands amounting 
in all to over eighty million acres have been granted to fifteen 
states.^^^ 

"The swamp land grant is an indefinite grant since it is of all the swamp 
and overflowed lands rendered thereby unfit for cultivation and remaining 
unsold at the date of the grant. The acreage given in this table [Table XII, 
p. 66] represents the lands claimed up to this time; as there is no hmit to the 
quantity the state may claim in the future, the true amount granted cannot be 
stated." 161 

The full force of this statement taken from the federal report 
is clearly shown in the grant made to Arkansas which follows: 

"An act to enable the state of Arkansas and other states to reclaim the 
swamp lands within their limits. 

"Be it enacted by the Senate and House of Representatives of the United 
States of America in Congress assembled, That, to enable the state of Arkansas 
to construct the necessary levees and drains to reclaim the swamp and over- 

155 Constitution of Iowa, 1846, Art. IX, Sec. 2, p. 3. 
15* Constitution of Wisconsin, Art. X, Sec. 2. 

157 Constitution of Oregon, 1859, Art. VIII, Sec. 2. 

158 Constitutional Ordinance, Sees, i, 6, 7, Gen. Laws of Kan., 1861, p. 46. 
169 Constitution of Nevada, 1864, Art. XI, Sec. 3. 

180 Kansas School Law, 1905, p. 5. 

161 Tables. State Grants of Public Lands, Gen. Land Office, Mar. 12, 1896, p. 9. 



FEDERAL SOURCES OF SCHOOL FUNDS 63 

flowed lands therein, the whole of these swamp and overflowed lands, made 
unfit thereby for cultivation, which shall remain unsold at the passage of this 
act, shall be and the same are hereby, granted to said state. 

"Sec. 4. And be it further enacted, That the provisions of this act be extended 
to, and their benefits be conferred upon, each of the other states of the Union 
in which such swamp and overflowed lands, known and designated as afore- 
said, may be situated." 1^2 

It would appear that the following states provide or have pro- 
vided for devoting a part or all of the proceeds derived from the 
sale of swamp lands to the support of common 

states Devoting '■ ^ ^ 

Swamp Lands to schools: Alabama, Florida, lUinois, Indiana, Lou- 

Conunon Schools . . tv/t- 1 • -n/r- -» • • 

isiana, Michigan, Minnesota, Mississippi, Mis- 
souri, Ohio, Oregon, and Wisconsin. The method by which the 
proceeds of these lands have been devoted to the principal of 
permanent common school funds differs considerably. Wisconsin 
provides that five per cent of the proceeds of the sales of federal 
public lands lying within the state shall be added to the principal 
of the school fund. Florida provides that twenty-five per cent of 
the proceeds of the sales of public land, now or hereafter owned by 
the state, should be added to the principal of the state school 
fund.^^^ These are general provisions applying to all lands received 
from the federal Government, save school lands, and therefore 
necessarily include swamp lands. 

Some states make specific provision that a certain per cent of all 
the proceeds of swamp lands shall be added to the principal of the 
permanent Common School Fund ; Oregon adds ten per cent to her 
Common School Fund.^^^ Illinois added largely to the permanent 
County School Funds estabhshed in 1835, from the proceeds of 
the sales of swamp lands. In 1868 Missouri made provision for 
making permanent the County School Funds established in 1839, 
and in doing so devoted the proceeds of the sales of 3,185,479 acres 
of swamp lands to those funds.* 

* See accounts given for each state in Part II. 

162 U. S. Statutes at Large, Vol. IX, Chap. 84, p. 519. 

163 Constitution of Florida, Art. XII, Sec. 4. 

16^ School Laws of Oregon, 1897, p. 47, Title XIII, Sec. 21. 



64 I^ERMANENT COMMON SCHOOL FUNDS 

Minnesota, by Chapter V, General Laws, 1865, directed that 
525,000 acres of swamp lands be reserved for the support of certain 
One-half Minne- State educational and charitable institutions. An 
Devot^''to^ ^^""^^ amendment to the state constitution, adopted in 
Common Schools jgg^^ article 8, section 2, provided that one-half 
of all swamp lands then held, or which might thereafter accrue to 
the state, shall be appropriated to the "Common School Fund," 
and one-half to the state educational and charitable institutions; the 
principal of the funds derived from the sales of such swamp lands 
to be forever preserved inviolate and undiminished. Not until 
1907, however, was an act passed which resulted in making these 
constitutional provisions effective. Since 1907, however, Minne- 
sota has distributed to the common schools of the state one-half 
the income of the swamp land fund together with that of the 
Permanent School Fund. As the result of this act, Minnesota 
has established a second permanent public common school 
fund. In 1908 the invested principal of one-half the Swamp 
Land Fund, amounted to $621,636.17, and the interest on the 
same to $18,637. i6.i'^^« 

The constitution of Indiana, 1851, provided that the surplus of 
the proceeds of swamp lands remaining after the expenditure of the 
amount necessary for the reclaiming of the lands should be added 
to the principal of the common school funcl.^'^''' In 1890 it was 
estimated that eight hundred fifty thousand dollars was due to the 
common school fund from this source, but owing to the dishonesty 
of swamp land commissioners, and to insufficient legislation, nothing 
had been added.^'^'^ Mississippi, in her constitution of 1868, pro- 
vided that the proceeds of swamp lands, with certain specific excep- 
tions, should constitute a part of the Common School Fund.^^'^ 
Alabama had disposed of her swamp lands in a similar way in her 

164<» Data supplied to F. H. Swift by Minnesota Auditor's Department, Dec. 2S, 
1908; also Advance Report from Biennial Report, 1907-08, Minnesota State 
Auditor, p. ix. 

165 Constitution of Indiana, 1S51, Art. VIII, Sec. 2. 

160 Report Ind. Supt. Public Instruction, 1866, p. 73; Boone, R. G., History of 
Ediicalion in Indiana, p. 200. 

167 Constitution of Mississippi, 1S68, Art. VIII, Sec. 6, 



FEDERAL SOURCES OF SCHOOL FUNDS 65 

constitution of the same year.^^^ Ohio has included the proceeds 
of swamp lands in her Irreducible Debt.^*^^ Michigan established 
a separate account from the proceeds of the sales of her swamp 
lands. The state uses the money as the proceeds are paid in and 
pays five per cent on this account, whence it is commonly known 
as the Five Per Cent Fund, although its official title is the Swamp 
Land Fund.^^" 

The so-called swamp lands from which Michigan derived her 
Five Per Cent Fund, were in reality military bounty lands. Con- 
Miiitary and grcss, in scction 2, of an Act passed December 24, 

University Lands ^g^ ^^ entitled, " An act for completing the existing 
military establishment," provided that any uncommissioned officer 
or soldier, honorably discharged from the military service, should 
be allowed and paid as a bonus, three months' pay and one hundred 
sixty acres of land.^'^^ 

By an Act passed May 6, 181 2, mihtary bounty lands were set 
aside in different regions. About two million acres, reserved in 
Michigan territory and later erroneously declared to be worthless, 
were returned to the state. These became the basis of the Swamp 
Land Fund established by the act of the legislature of Michigan in 
1858.^^^ In lieu of these Michigan lands, one million, five hundred 
thousand acres were set aside in the territory of Illinois, and five 
hundred thousand acres in the territory of Missouri, north of the 
Missouri river.^'^^ 

Arkansas devoted to her Common School Fund two townships 
granted for the state university .^^^ 

The above account makes evident the variation in the objects 
to which the states have devoted their grants of salt, internal 
improvement and swamp lands and the proceeds of the sales of the 

IC8 Constitution of Alabama, 186S, Art. XI, Sec. 10. 
160 Ohio School Report, 1901, p. 9. 
1™ Report Mich. Supt. Public Instruction, 1903, p. 24. 
171 U. S. Statutes at Large, 12th Congress, Vol. II, Chap. X, pp. 669-670. 
"2 Laws of Mich., 185S, No. 31, Sec. 5, p. 171; Report Mich. Supt. of Public 
Instruction, 1889, p. 22, gives full account. See also Part II. 

173 Act Apr. 29, 1816, U. S. Statutes at Large, Vol. Ill, Chap. CLXIV, p. 332. 

174 Constitution, 1S68, Art. IX, Sec. 4, 



66 



PERMANENT COMMON SCHOOL FUNDS 



same. This variation, the difficulty of getting access to the neces- 
sary reports and the hmits of the present investigation make it 
impossible to show here to what extent these lands have been 
devoted to the support of common schools. Table XII, which 
follows here, shows the area of these lands, as estimated by the 
federal land commissioner. 



Table XII. Area of Internal Improvement, Saline, and Swamp Lands 
Granted to the States by the Federal Government * 



Stales 



Internal 

Improvement 

Acres 



Salt Springs and 

Contiguous Lands 

Acres 



Swamp Lands f 
Acres 



Alabama 500,000 

Arkansas 500,000 

California 500,000 

Colorado 500,000 

Florida 500,000 

Idaho 

Illinois 500,000 

Indiana 500,000 

Iowa 500,000 

Kansas 500,000 

Louisiana 500,000 

Michigan 500,000 

Minnesota 500,000 

Mississippi 500,000 

Missouri 500,000 

Montana 

Nebraska 500,000 

Nevada 500,000 

Ohio 500,000 

Oregon 500,000 

Wisconsin 500,000 

Total 9,500,000 




531,355.60 
8,656,372.39 
1,887,685.23 

22,244,541.07 



3,981,784.10 

1.377,727-70 
4,570,132.33 

11,769,455.83 
7,293,159.28 
4,738,549.78 
3,603,921.68 
4,843,636.09 



117,931.28 

434,428.45 

4,569,712.12 

80,620,392.93 



In addition to federal grants of land from which the states have 
derived moneys for permanent school funds, Congress, from the 



* Table taken from State Grants of Public Lands, 'J'S'bles, General Land Office, 
March 12, 1896, p. 8. 
t Claims reported to December 31, 1895, 



FEDERAL SOURCES OF SCHOOL FUNDS 67 

first, has granted moneys which many of the states have employed 
either to create permanent common school funds or to enlarge 
Federal Money those already established. In the Ohio enabling 
Grants ^^^ quoted above, one-twentieth of the net proceeds 

of the lands sold by Congress after June 30, 1802, were granted 
to the state to be applied to laying out and making public roads. 
Every public land state, admitted since 1802, has received a grant 
of a certain per centum of the proceeds of the sales of lands belong- 
ing to the United States, sold after the state's admission into the 
Union. In the case of Ohio, as stated in the enabling act, this grant, 
together with others, was made on condition that no taxes of any 
kind should be levied upon the land for five years after the date of 
sale. The purpose of this condition was to prevent any individual 
from obtaining a tax title under the state, before the United States 
had received full payment of the purchase money. This purpose is 
clearly shown in the constitutional ordinance of Kansas. 

The constitutional ordinance of Kansas, adopted January 29, 
1861, reads: 

"Whereas, the government of the United States is the proprietor of a large 
portion of the lands included in the limits of the state of Kansas as defined 
by this constitution; and whereas the state of Kansas will possess the right 
to tax said lands for purposes of government, and other purposes: Now, 
therefore, be it ordained by the people of Kansas, 

"That the right of the state of Kansas to tax such lands is relinquished 
forever, and the state of Kansas will not interfere with the title of the United 
States to such lands, nor with any regulation of Congress in relation thereto, 
nor tax nonresidents higher than residents: Providid always, That the follow- 
ing conditions be agreed to by Congress: " 

The conditions that follow include the grant of sections numbers 
sixteen and thirty-six in each township for common schools, two 
townships for a state university, five hundred thousand acres of 
land under the Act of 1841 and 

"Sec. 6. That five per centum of the proceeds of public land in Kansas, 
disposed of after the admission of the state into the Union, shall be paid to 
the state for a fund the income of which shall be used for the support of com- 
mon schools." 



)8 PERMANENT COMMON SCHOOL FUNDS 

In some states provision has been made in the enabhng act that 
the per centum granted by Congress be made a part of the state 
permanent school fund, as, for example, in North Dakota. Others 
have provided in general terms that such per centum as has been or 
may hereafter be granted by Congress on the sale of the lands in 
the state, should be added to the permanent common school fund. 

Illinois created her first state controlled fund from two and five- 
sixth per cent of the net proceeds of the sale of public lands granted 
by Congress.* The only permanent common school fund which 
New Mexico has at the present time consists of nineteen thousand 
six hundred seventy-five dollars and seventy-three cents derived 
from the congressional grant of live per centum of the sales of pub- 
lic land lying within the territory .^'^^ 

Some states have made general provisions which may appear to 
include the five per centum of proceeds of sales of public lands. 
Idaho, in her constitution, provides as one of the sources from 
other which the public school fund shall be derived or increased, " all 
grants of land or money made by the state for educational purposes 
or where no other specific purpose is indicated in such grant."^ 

The following states have received from Congress the per cent 
indicated of the proceeds of the sales of public lands :^" Ohio, Indi- 
ana, and Illinois received three per cent: Alabama, 
Per Cent ' r > j 

Granted to Mississippi, and Missouri received three and two 

Different States , _,.,,. 

per cent under separate acts. The followmg states 
received five per cent: Arkansas, California, Colorado, Florida, 
Idaho, Iowa, Kansas, Louisiana, Michigan, Minnesota, Montana, 
Nebraska, Nevada, Territory of New Mexico, North Dakota, Ore- 
gon, South Dakota, Utah, Washington, Wisconsin, and Wyoming. 
In 1841 Congress granted to Ohio, Indiana, Illinois, Alabama, 
Missouri, Mississippi, Louisiana, Arkansas, and Michigan, over 
and above what each was entitled to by the terms of their admis- 

* Consult account given in Part II. 

"5 Statement furnished Oct. 20, igo6, by Hyram HacUey, New Mexico Terri- 
torial Superintendent of Schools. 

176 Gen. School Laws of the State of Idaho, 1897-98, Sec. 72. 

177 Statement received Aug. 27, 1906, from Department of Interior, General 
Land Office, Washington, D. C. 



FEDERAL SOURCES OF SCHOOL FUNDS 69 

sion into the Union, ten per centum of the net proceeds of the sales 
of pubhc lands made after December 31, 1841.^^^ It will be seen 
that this was an additional per centum grant. Some of these 
states devoted the moneys derived from this grant to their perma- 
nent common school funds. Louisiana did so by a constitution 
adopted in 1845.^^* 

Reference has been made to the use made of the proceeds of 
these grants by New Mexico, Illinois, Arkansas, Florida, and Idaho. 
The following states provide by their constitutions that moneys 
derived from this source shall be added to the principal of the state 
common school fund: California, Iowa, Kansas, Montana, Ne- 
braska, Nevada, North Dakota, Oregon, South Dakota, Washing- 
ton, Wisconsin, and Wyoming. 

The amounts which have been added to the permanent common 
school funds in the different states from this source have not been 
ascertained. Missouri, previous to 1900, had increased her perma- 
nent state school fund by about one million dollars from this 
source.^'''^ New Mexico, as noted above, has accumulated twenty 
thousand dollars. California, by an Act of Congress approved 
June 27, 1906, was granted payment of five per cent of the pro- 
ceeds of public land sales extending over a score of years. Under 
the requirements of the constitution this sum must be added to the 
perpetual school fund. Within two months after the approval 
of the act, warrants amounting to four hundred twenty-eight thou- 
sand, two hundred seventy-one dollars and sixty-one cents had 
been drawn to the credit of the state. It is expected that the 
amount involved will ultimately approach one million dollars.^^*^ 

In 1833 President Jackson caused the withdrawal from the 

United States Bank, of the Government deposit of ten million dollars, 

which amount the federal Government thereupon 

United States . . , ^ 

Deposit Fund distributed among the various state banks. Indi- 

ana is an example of a state which used part of 
this as a basis for a permanent common school fund. It is suffi- 

178 Constitution, 1845, Title 7, Art. 135. 

179 Boone, Education in the United States, p. gi. 

ISO Report California Controller, 1905-06, pp. 24-28, 29. 



70 PERMANENT COMMON SCHOOL FUNDS 

cient to say that Indiana chartered a state bank on January 13, 
1834, consisting of ten banks located in different parts of the state. 
On shares of stock held by individuals, an annual tax of twelve 
and one-half cents a year was issued. Section 15 of the charter of 
the state bank provided that the money derived from the proceeds 
of this tax "shall constitute a part of the permanent fund to be 
devoted to purposes of common school education." In 1851 this 
fund became a part of the principal of the Common School Fund, 
adding to this latter fund about eighty million dollars.^^^ 

"Prior to 1825 the monetary and other interests of the United States had been 
characterized by much confusion and complexity. The federal debt of the 
United States Revolution amounted to nearly forty million ($40,000,000) 

Surplus Revenue dollars and the state debts assumed by the general govern- 
ment to twice as much more. The Louisiana purchase of 
1803, together with certain individual claims upon the French, made a debt of 
fifteen million ($15,000,000) dollars, paid by the United States in bonds draw- 
ing six per cent interest, and due in fifteen years. The debt incident to the war 
of 1812 added another one hundred million ($100,000,000) dollars. Notwith- 
standing all which, by the second quarter of the centuiy, and within a single 
generation of Washington, and especially during the decade after 1827, the 
prosperity of the country was almost without precedent. The national debt 
had been liquidated, and there actually remained in the treasury a surplus of 
about forty million ($40,000,000) dollars." 1*2 

By an Act of Congress approved June 23, 1836, entitled, "An Act 
to regulate the deposits of public money," it was provided that the 
money remaining in the United States treasury on January i, 1837, 
except the sum of five million ($5,000,000) dollars should be depos- 
ited with such of the states of the Union, in proportion to their 
number of representatives in Congress, as shall by law authorize 
their treasurers or other authorities to receive the same on the terms 
specified. The terms of the act made it a loan, not a permanent 
grant. An official receipt was required and an obligation on the 
part of the state to pay the amount recei^'ed or any portion of it 
when called for by the secretary of the United States treasury. 

181 Reports of State Supt. of Public Instruction of Ind., 1872, Vol. II, p. 170; 
1885-86, Vol. II, p. 11; 1900, p. 298. 

182 Boone, R. G., History of Education in Indiana, pp. 193-196. 



FEDERAL SOURCES OF SCHOOL FUNDS 7 1 

Not more than ten thousand ($10,000) dollars could be demanded 
from a single state without thirty days' notice. Section 13 of the 
act by which Congress made provision for this loan reads as 
follows: 

"An act to regulate the deposits of the public money. 

"Sec. 13. And be it further enacted, That the money which shall be in 

the treasury of the United States on the first day of January [1837], eighteen 

. ^ T o < hundred and thirty-seven, reserving the sum of five millions 

Act June 23, 1830 •' ' ° 

of dollars, shall be deposited with such of the several states, 
in proportion to their respective representation in the Senate and House of 
Representatives of the United States, as shall by law, authorize their treas- 
urers or other competent authorities to receive the same on the terms herein- 
after specified; and the Secretary of the Treasury shall deliver the same to 
such treasurers or other competent authorities, on receiving certificates of 
deposit therefor, signed by such competent authorities, in such form as 
may be prescribed by the secretary aforesaid; which certificates shall ex- 
press the usual and legal obligations, and pledge the state, for the safe keep- 
ing and repayment thereof, and shall pledge the faith of the states receiving 
the same, to pay the said moneys and every part thereof, from time to time, 
whenever the same shall be required by the Secretary of the Treasury for the 
purpose of defraying any wants of the public treasury, beyond the amount of 
the five millions aforesaid: Provided, That if any state declines to receive its 
proportion of the surplus aforesaid, on the terms before named, the same shall 
be deposited with the other states, agreeing to accept the same on deposit in 
proportion aforesaid: And provided further. That when said money or any 
part thereof shall be wanted by the said secretary, to meet appropriations by 
law, the same shall be called for in rateable proportions, within one year, as 
nearly as conveniently may be, from the different states with which the same 
is deposited and shall not be called for in sums exceeding ten thousand ($10,000) 
dollars from any one state in any one month, without previous notice of thirty 
days for every additional sum of twenty thousand ($20,000) dollars which may 
at any time be required. 

"Sec. 14. And be it further enacted. That the said deposits shall be made 
with the said states in the following proportions, and at the foUovring times, 
to-wit: one-quarter part on the first day of January, 1837, or as soon thereafter 
as may be; one-quarter part on the first day of April, one-quarter part on the 
first day of July and one-quarter part on the first day of October, all in the 
same year." i83 

It was estimated that there would be thirty-seven million, four 

183 Statutes at Large, 24th Congress, Session I, Vol. V, Chap. 115, p. 55. 



72 PERMANENT COMMON SCHOOL FUNDS 

hundred sixty-eight thousand, eight hundred fifty-nine dollars and 
forty-seven cents ($37,468,859.47) in the treasury on January first 
to be loaned to the states. The entire loan was to be paid in four 
instalments of nine million, three hundred sixty-seven thousand, 
two hundred fourteen dollars and eighty-seven cents ($9,367,214.87) 
each, and all four during the year 1837-38. Only three instal- 
ments were ever paid, amounting to about twenty-eight million 
dollars. 

The money thus loaned to the states has never been called for by 
the federal Government and in all probability never will be. Many 
of the states, in practice at least, have regarded it as a permanent 
gift. By far the majority of the states set apart their portion, 
or a fraction of it, for the support of common schools. The in- 
come, or a portion of it, has reached the common schools in 
every state except four, Michigan, Mississippi, South Carolina, 
and Virginia. 

At least five states, Alabama, Delaware, Louisiana, Missouri, 
and New York, set apart all of their respective shares as a separate 
fund or united it with the permanent common school fund already 
states Devoting established. Missouri used her share, together 
Reveni^^Toan with seventy-two sections of saline lands as an 
to Schools original basis for establishing her state Public 

School Fund.^^"* New York established her share as a separate 
fund and provided that the income should be appropriated to 
common schools and high schools. Twenty-five thousand dollars 
of the annual revenue of this fund is added each year to the principal 
of the Common School Fund, and constitutes one of the chief 
sources by which that fund is being increased to-day. Delaware 
invested her share in the same securities as the principal of the 
Public School Fund and provided that the income derived from this 
investment should be divided among the three counties of the state 
in the same manner as the income of the Public School Fund. 

North Carolina received one million, four hundred thirty-three 
thousand, seven hundred fifty-seven dollars ($1,433,757). She 

18* Bourne, Edward G., History of the Surplus Revenue of 1S37; Report Missouri 
Supt. Public Instruction, 1869, p. 38. 



FEDERAL SOURCES OF SCHOOL FUNDS 73 

provided that of this share, one million, one hundred thirty-three 
thousand, seven hundred fifty-seven dollars ($1,133,757) should 
Fractions of be added to the Literary Fund. The following 

Loan^DevoteT"^ states devoted the interest on a fraction of their 
to Schools share to the support of common schools, thus mak- 

ing this portion of their respective loans practically a permanent 
fund or loan for common schools: Maryland devoted the interest 
on seven-ninths of her share to the support of common schools; 
Indiana and Illinois each employed two-thirds of their shares for 
the same purpose; Kentucky, four-sevenths and Georgia, one-third. 

Maine distributed her share chiefly per capita; a small part of it 
was devoted to the schools. Massachusetts and New Hampshire 
distributed their shares among the towns. In both states some 
towns used the income for schools. " In Portsmouth, New Hamp- 
shire, the inhabitants voted to divide the revenue which fell to the 
town, per capita. The sum due to each man, woman, and child 
was between two and three dollars. An agent was appointed to 
receive and distribute the money. About two hundred suits were 
almost immediately commenced against him as trustee to individ- 
uals owing small sums and he was thus placed in a rather embar- 
rassing position." ^®^ 

Connecticut deposited all her share except about one thousand 
dollars with the towns. The loan thus made became known as 
the Town Deposit Fund. Until 1855, three-fourths, and since 1855 
the whole of the income of this fund, according to Bourne,^^^ was 
devoted to aid common schools, but the Secretary of the Board 
of Education writes that '' in most cases the interest on this fund 
exists on paper only and is not a substantial contribution to the 
support of schools." ^^^ Vermont loaned her entire amount to the 
towns who were held responsible to the state in the same manner 
that the state is responsible to the federal Government.^*^ Investi- 

i**5 Bourne, E. G., History of the Surplus Revenue of 1837, p. 83. 
188 Ibid., pp. 50, 122. 

187 Report Conn. Board of Education, 1903, p. 43.- 

188 Statement received Nov. 9, 1906, from Mason S. Stone, Vermont State Supt. 
of Education. 



74 



PERMANENT COMMON SCHOOL FUNDS 



gation carried on by the Vermont state department of education in 
1906 revealed the fact that eighty per cent of the towns have ab- 
sorbed their portion of the United States Deposit Fund. Such 
towns pay interest on their portion of the fund at the rate of six 
per cent.^*^ Table XIII which follows here shows the amount 
each of the twenty-six states received as its share of the United 
States Surplus Revenue Loan, the amount set aside as a permanent 
fund for common schools, when ascertainable, and the amount 
lost, when ascertainable. 

Table XIII. Permanent Common School Funds or Deposits Derived 
FROM United States Surplus Revenue Distributed in 1837 * 



State 



Share 
Received 



Set Apart as 
a Perma- 
ne>ii Fufzd or 
Deposit for 
Co»ivion 
Schools 



A->7iou>it of 
Portion 
thiis Set 
Apart Di- 
verted, 
Lost or 

E.xJunisted 



Original Use of 
Principal 



Final Disposition, 
or Present Condi- 
tion of Principal 



I. Ala. 



2. Ark. 



3. Conn, 



$669,086 



286,751 



764,670 



$669,086 



286,751 



763,670 



$669,086 



.751 



Used for capital 
of State Bank and 
branches. Interest 
used for schools till 
1843 3^^d since 1854.'^ 
Entire amount used 
as principal of the 
Bank of the State of 
Ark. Law devoted 
interest to schools. 
But law was dead 
letter. Little, if any, 
ever reached the 
schools. 

All except $1,000 
was divided among 
the towns. Most 
has been lost by 
towns, which how- 



Credit Fund.'^t 



Credit Fund.f 



Town Credit 
Funds, t 



189 Ibid., personal letter, dated Nov. 9, 1906. 

* Compiled from E. G. Bourne, History of the Surplus Revenue of iSjy, and 
from accounts given in Part II of the present work. All notes reading Bourne 
refer to the above work. 

'^ Bourne, pp. 44-47. 

t For a description of Credit Funds, see Chapter I. 



FEDERAL SOURCES OF SCHOOL FUNDS 

Table XIII — continued 



IS 



State 



Share 
Received 



Set Apart as 
a Perma- 
nent Fund or 
Deposit for 
Common 
Schools 



Amount of 
Portion 
thus Set 
Apart Di- 
verted, 
Lost or 
Exhausted 



Original Use of 
Principal 



Final Disposition, 
or Present Condi- 
tion of Principal 



4. Del. 



S- Ga. 



6. 111. 



7. Ind. 



7SI 



1,051,422 



477>9i9 



860,254 



$286,751 



350,000 



335,592 



567,126 



335>S92 



567,126'* 



ever continued to 
pay interest. Prior 
to 1855, f income, 
and since 1855, all 
the income was de- 
voted to schools.* 



Interest on J was 
appropriated for 
schools but probably 
used for state gen- 
eral expenses till 
1870. » 

Principal borrowed 
by the state and used 
for extravagant in- 
ternal improvements 
Interest devoted to 
common schools. J 
Two-thirds distrib- 
uted among counties 
to be loaned. Inter- 
est on loans devoted 
to common schools. 
One-third used for 
capital of State 
Bank. Made a part 
of the permanent 
Common School 
Fund, 1851. 



Practically part 
of Public School 
Fund. « 

Lost: Appar- 
ently not recog- 
nized as a debt 
by Georgia. 



Principal ex- 
hausted. Con- 
tinued as a 
Credit Fund.f 



^ Ibid., p. 122. 

<* Report, Connecticut Board of Education, 1903, p. 43; and Bourne, pp. 50, 122. 

« Bourne, pp. 52, 53. ' Bourne, pp. 60, 61. 

^ Bourne, p. 122, states that the two-thirds, the interest on which was devoted 
to schools, was lost. Ibid., pp. 63, 64, shows it is impossible to state accurately 
the amount lost. 

I For a description of Credit Funds, see Chapter I. 



76 



PERMANENT COMMON SCHOOL FUNDS 
Table XIII — continued 



Slate 


Share 
Received 


Set Apart as 

a Perma- 
nent Fund or 
Deposit for 
Common 
Schools 


Amount of 
Portion 
thus Set 

Apart Di- 
verted, 
Lost or 

Exhausted 


Original Use of 
Principal 


Final Disposition, 
or Present Condi- 
tion of Principal 


8. Ky. 


$1,433,757 


$850,000 


$850,000 


Principal used to 
purchase bank stock 
and to pay state 
debt. Interest on 
$850,000 devoted to 
common schools.*^ 


Seized by State 
Credit Fund.f 


9. La. 


477,919 


477,919 


477,919 


Exhausted by appro- 
priations in 1839. 
Since 1839 con- 
tinued as a credit 
fund, devoted to 
support common 
schools since 1855. ^ 


Permanent debt. 
Interest devoted 
to common 
schools. 


10. Me. 

11. Md. 


955,838 
955,838 


i 
681,387 


i 
681,387 


Interest, 1839, paid 
from annual revenue 
of the Baltimore and 
Washington Rail- 
road. Later out of 
taxes. J 


Credit Fund.f 


12. Mass. 


1,338,173 


I 




Some used for 
schools. Most used 
for town expenses.* 




13. Mich. 

14. Miso. 

15. Mo. 


286,751 
382,335 
382,335 


382,335 






Reported to be 
intact.w* 


16. N. H. 
17- N. J. 


669,086 
764,679 


I 
611,743 


n 


Divided among 


Most all princi- 



c See account given in Part II; also Bourne, pp. 65-68. 

Part II; also Bourne, pp. 68, 69. 

< Distributed among tov^rns, some of which used it for schools. Most appear 
to have apportioned it per capita among entire population. Bourne, p. 71. 

1 Bourne, p. 73. Acts of Maryland, 1839, chap. 33. 

' Divided among towns; some of which used it to establish permanent school 
funds; number and value of funds so established not ascertainable. 
^ Bourne, p. 81. '^ Large loss, amount not ascertainable. 

■j" For a description of Credit Funds, see Chapter I, 



FEDERAL SOURCES OF SCHOOL FUNDS 
Table XIII — continued 



77 



Stale 



Share 
Received 



Set A part as 
a Perma- 
nent Fund or 
Deposit for 
Common 
Schools 



Amount of 
Portion 
thus Set 

Apart Di- 
verted, 
Lost or 

Exhausted 



Original Use of 
Principal 



Final Disposition, 
or Present Condi- 
tion of PritKipal 



18. N. Y. 

19. N. C. 



20. Ohio 



21. Penn. 

22. R. I. 



54,014,520 
i>433,757 



2,077,260 



2,867,514 
382,335 



54,014,520 
i>i33>7S7 



382,335 



$333>862'' 
i>i33.757 



226,794 



counties which ap- 
pear to have ex- 
hausted it in erect- 
ing buildings and 
paying war debts. 
Interest kept up; 
paid largely out 
of taxation. Since 
1867 interest on | 
devoted to schools.* 

$300,000 was added 
to the Literary Fund 
at once. Eventually 
all the surplus rev- 
enue N. C. received, 
except $100,000 was 
devoted to the sup- 
port of schools. Loss 
due to Civil War 
and reconstruction 
evils. Borrowed by 
the state.P 
Distributed among 
counties. Loaned at 
6%; 5% devoted to 
schools. 1851 "Bal- 
ance" was added to 
common school fund 
Amount not ascer- 
tainable. 8 

In 1836 the interest 
from the entire a- 



pal exhausted. 
Credit Ac- 

count, f 



State repudiated 
debt. 



Apparently con- 
tinued as a 
credit fund.*! 



* Bourne, p. 122. 

Report, New York Comptroller, 1906, p. 280. 

"P See account in Part II; also Bourne, pp. 91-93. 

9 See Part II; also Bourne, pp. 95-99. 

j For a description of Credit Funds, see Chapter I, 



78 



PERMANENT COMMON SCHOOL FUNDS 

Table XIII — continued 



State 



Share 
Received 



Set Apart as 

a Perma- 
nent Fund or 
Deposit for 
Common 
Schools 



Amount of 
Portion 
thus Set 

Apart Di- 
verted, 
Lost or 

Exhausted 



Original Use of 
Principal 



Final Disposition, 
or Present Condi- 
tion of principal 



23. s. c. 

24. Tenn. 



25. Vt. 



26. Va. 



>I,05I,422 

I.433.7S7 



669,086 



2,198,427 



$669,086 



t 



'i,433>757 



500,000 



mount was devoted 
by law to common 
schools. But only 
$155,541 appears to 
have ever been made 
a part of the perma 
nent school fund 
The state appears 
not to recognize her 
indebtedness techni- 
cally. But the an- 
nual appropriation 
exceeds the interest 
on the surplus 
revenue. '', * 

From 1841 to 1865, 
interest devoted 

largely to common 
schools; but no part 
of the principal was 
ever set apart for a 
permanent school 
fund. ^ 

At first loaned to 
towns, which ex- 
hausted most of it; 
in 1906 made a part 
of the state perma- 
nent school fund. 



Exhausted 
banking. * 



About 20% of 
principal is in- 
tact. About 
80% is a 
Credit Fund. 



Some states have increased the principal of their permanent com- 

* Bourne, p. 122. 

»■ Report, United States Commissioner of Education, 1896-97, I, 642. 

* Bourne, p. 114. 

X It is possible that $225,793 was added to the Literary Fund, but the data is 
not clear. Bourne, p. 120, 



FEDERAL SOURCES OF SCHOOL FUNDS 79 

mon school funds from claims against the United States Govern- 
ment for services rendered in war, or other moneys returned by the 
War Claims federal Government as reimbursement for taxes it 

SdToofs^ *° h3,d previously levied. The state of Maine, by an 

1828-1904 Act passed by the legislature February 23, 1828, 

made provision for the establishment of the Permanent School 
Fund, for the benefit of primary schools.^*^^ This act reserved, 
together with certain state lands, all moneys received by Maine 
on account of war claims against the United States for services 
rendered in 1812. The Permanent School Fund was deprived 
of the moneys from this source by a Repeal Act passed March 

11,1835-''' 
In 1 861 Congress passed an act directing that a direct tax of 

twenty million dollars be annually laid upon the United States, 
Federal War ^^^ apportioned among the states and territories 

^^^^^ according to the provisions of the act. In 1891 

an act was passed providing for the return of this tax to the states 
and territories.^^^ Massachusetts,^^^ Kentucky,^^^ and South Caro- 
lina ^^^ are among the states which have provided that the moneys 
received as the result of this act should be added to their permanent 
school funds.^^"* As the result of these acts Kentucky added six hun- 
dred six thousand, six hundred forty-one dollars and three cents 
($606,641.03) to her Permanent School Fund; Massachusetts, six 
hundred ninety-six thousand, four hundred seven dollars and eighty- 
eight cents ($696,407.88) to her School Fund. By the same act by 
which Massachusetts added the proceeds of the direct tax to her 
School Fund, she also added twelve thousand, forty-three dollars 
and seventy-three cents ($12,043.73) of United States war claims.^^^ 
Vermont, in 1904, by number 42 of the acts of that year, seques- 
tered as permanent fund for public school purposes the reimburse- 
ment to the state of two hundred forty thousand dollars for moneys 

190 Laws of 1828, Chap. 403. 

191 Maine School Report, 1901, p. 52. 

192 U. S. Statutes at Large, 1861, Chap. XLV, Sec. 8, p. 294. 

193 Fifth-seventh Annual Report, Board of Education of Mass., 1892-93, p. 102; 
Laws of Ky., Act approved Mar. 12, 1892; Constitution of South Carolina, 1895. 

194 U. S. Statutes at Large, 1891, Chap. 496, p. 822. 



8o PERMANENT COMMON SCHOOL FUNDS 

expended in the Spanish- American war. The creation of this fund 
was the beginning of a new period in the history of permanent 
school funds in Vermont. A complete account is given in Part II. 
In a previous chapter it has been pointed out that Congress 
makes annual appropriations for the support of schools in Alaska 
and the District of Columbia. All of the land 

Congressional 

Appropriation in Indian Territory belonged to members of the 

five civilized tribes and Congress had no authority 
to reserve any of it for school purposes. In lieu of the grant of 
sixteenth and thirty-sixth section lands for common schools, Con- 
gress made an appropriation of five million dollars ($5,000,000) with 
interest at three per cent from June 16, 1906. The statehood bill, 
by which Indian Territory and Oklahoma were to be combined, pro- 
vided that this appropriation should constitute a part of the perma- 
nent school fund upon the admission of the state into the Union.* 
The purpose of this chapter has been to present the sources 
provided by the federal Government which have been employed to 
establish or increase the permanent common school 

Conclusion r i • i • mi 

funds m the various states. The earliest permanent 
common school funds were those derived from state lands and 
moneys. In view of the fact that the first of these, Connecticut, 
was derived from lands lying in Ohio, within federal domain, and in 
view of the fact that many of these federal sources have contributed 
largely to permanent funds of state origin, it seemed best to treat 
the federal sources of permanent school funds before taking up the 
topic of state sources. Nevertheless, it must be borne in mind that 
the establishment of state permanent funds for common schools by 
Connecticut and New York was but the final stage in a process of 
evolution. This process has been traced in Chapter II, under the 
topic of Local Funds. However, the ordinance of 1785 was passed 
ten years prior to the establishment of the first permanent fund so 
that it is dijBScult to say to what extent the policy of the states which 
derived their funds from state rather than federal sources, was the 
result of principles individually conceived and to what extent it was 
an adopting of the policy pursued by the federal Government. 

* See separate accounts for Indian Territory and Oklahoma in Part II. 



CHAPTER IV 

STATE SOURCES AND ESTABLISHMENT OF PERMANENT PUBLIC 
COMMON SCHOOL FUNDS 

Interest turns naturally toward those states which received no 

grant of land from the United States Government and so were forced 

to employ their own resources. The previous 

Classes of State ^ ■; ., i r i i r t i 

Sources Similar chapter described federal grants of lands and 
money out of which public land states created per- 
manent common school funds. The purpose of this chapter is to 
consider the sources which the states of their own initiative have 
set aside, either to establish or to increase their permanent com- 
mon school funds. It might seem desirable to attempt to dis- 
tinguish between those sources set aside as original capital out of 
which the permanent common school funds were created and the 
sources from which they have been increased. However, it would 
be difficult to do so, owing to the fact that in some cases the 
sources originally provided were the proceeds of current revenues, 
so that there was in the beginning no accumulated capital. 

States containing no federal lands have set aside many of the 
sources employed by the public land states for increasing their 
funds; such as escheats, licenses, bequests, and fines. In Chap- 
ter II, state sources of permanent common school funds were divided 
into two classes: (i) state lands, and (2) state moneys. In view 
of the fact that lands are the oldest state source, it may be well to 
consider them first. 

The states which derived their permanent funds or a portion of 

them from the proceeds of the sales of lands originally belonging to 

or claimed by the state and not from a grant to it, 

State Lands as ^ . 

a Source of as a gift, by the federal Government are: Connecti- 

cut, New York, Georgia, New Jersey, North Caro- 
lina, Pennsylvania, Maine, Massachusetts, Texas, and New Hamp- 

Si 



82 PERMANENT COMMON SCHOOL FUNDS 

shire. In Chapter III it was shown how Connecticut came to 
possess a reservation of lands lying in the northeastern corner of 
Ohio. In 1795 provision was made for the sale of all lands remain- 
ing unsold, about three million, three hundred thousand acres.^^^ 
This land was sold for one million, two hundred thousand dollars 
($1,200,000) ^^^ which became the original principal of the School 
Fund of Connecticut. New York, by an Act of legislature, April 2, 
1805, provided that the net proceeds of five hundred thousand 
acres of unappropriated state lands, the first to be sold after the 
passing of the act, should be appropriated as a permanent fund for 
the support of common schools.^" 

Georgia provided for the establishment of her Permanent Com- 
mon School Fund in 181 7. In 181 8, by the Land Lottery Act, lots 
numbers 10 and 100 in each surveyor's district, were set apart and 
reserved for the benefit of common schools. Subsequent legis- 
lation made the proceeds of these lots a part of the Permanent 
School Fund. New Jersey provided for the establishment of her 
Permanent Common School Fund in 1817.^^^ Subsequent legisla- 
tion has provided that the proceeds of all lands belonging to the 
state, now or formerly lying under water, shaU be added to the 
principal of the Permanent Common School Fund.^^^ North Caro- 
lina provided as source from which her Permanent Common School 
Fund, known as the Literary Fund, established in 1828, was to be 
derived, moneys paid to the state for entries on vacant lands, and 
the proceeds of vacant and unappropriated swamp lands in the 
state.i^^ 

The Permanent School Fund of Maine and the Massachusetts 
School Fund were both derived from lands lying in Maine, at one 
time all owned by Massachusetts, but subsequently shared by the 
two states upon their separation in 1820. In the year 1828 Maine 
created her Permanent Common School Fund and reserved thirteen 



195 Report Conn. Board of Education, 1S53, p. 69. 

188 Ibid., 1876, p. III. 

197 Laws of New Jersey, 1817, Act passed Feb. 12. 

198 New Jersey School Laws, 1903, Sec. 16S-169. 

199 North Carolina Revised Statutes, 1836-37, Chap. 66, pp. 378-379. 



STATE SOURCES AND ESTABLISHMENT 83 

townships for the same.^°" Twelve more townships were added to 
it in 1850, one year before the first distribution of the revenue of 
the fund. The total area of lands thus far set aside was about 
seven hundred twenty-six thousand, six hundred twenty-five 
acres/"^ The proceeds realized from the sale of these lands 
amounted to approximately two hundred seventy-eight thousand, 
two hundred thirty-nine dollars ($278,239)/°^ In 1868 ten town- 
ships whose timber and lumber had been devoted to the Permanent 
School Fund in 1864, were now, themselves, added to it.^"^ 

In 1786, Pennsylvania passed an act setting aside sixty thousand 
acres of unappropriated state lands for the purpose of endowing 
public schools.^^^ But the proceeds of the sales of the lands 
reserved by this act never reached the public schools. They were 
probably given to county academies.^"^ Pennsylvania finally suc- 
ceeded in passing an act in 1831 by which was actually estab- 
lished ^°^ her Common School Fund. The original capital of this 
fund consisted of state lands. It has not been possible to learn the 
area of these lands, but it would appear that in 1834 about a mil- 
lion and a half of dollars had been realized from the sales.^*^^ 

Massachusetts, by an Act passed March 31, 1834, provided that 
the moneys in the treasury on January i, 1833, derived from the 
sale of lands in Maine, together with fifty per centum of all moneys 
thereafter to be received from the sale of Maine lands (and certain 
other moneys) shall be appropriated and constitute a permanent 
fund for the aid and encouragement of common schools.^^ In 
1859 it was provided that "all avails of the moiety on the sales of 
certain Back Bay Lands (made lands) ^°^ be added to the Massa- 

200 Maine Laws, 1828, Chap. 403. 

201 Computed from data given in Maine School Report, 1857, p. 17. 

202 Maine School Report, 1855, p. 16. 

203 Resolves of the State of Maine, 1868. 
20* Section VII, Act approved Apr. 7, 1786. 

205 J. p. Wickersham, History of Education in Pennsylvania, p. 257. 

206 Sections I-III, Act passed Apr. 2, 183 1. Quoted by Wickersham, pp. 292-293, 
see foot-note 205. 

207 Mayo, A. D., The American Common Schools, etc., Report U. S. Commissioner 
of Education, 1895-96, pp. 261-262. 

203 Mass. Resolves, 1852, Chap. 79, Second Resolve. 



84 PERMANENT COMMON SCHOOL FUNDS i 

chusetts School Fund.^'^'' The sum added to the principal of the 
fund from the proceeds of the sales of these lands was four hundred 
fifty-six thousand, nine hundred thirty-six dollars ($456,936).^^'^ 

Texas in 1839 made provision for granting to each county in 
the then Republic 13,284 acres.^^^ In 1840 the county grant was 
increased to 17,713 acres.^^^ From these lands were created sepa- 
rate permanent school funds commonly spoken of collectively as 
the County School Fund. It is estimated that under these acts 
the counties have received 4,162,320 acres.^^^ Upon being admitted 
into the Union Texas provided for the establishment of a state pub- 
lic permanent common school fund.'^^ Approximately 38,000,000 * 
acres of state lands have been devoted to this fund. The total 
area reserved by Texas out of its domain for the County School 
Fund and the Permanent School Fund, prior to 1900, amounted 
to approximately 42,053,058.11 acres.* 

As pointed out in Part II, the Literary Fund which New Hamp- 
shire provided for in 182 1, never became a permanent fund. Her 
first Permanent Common School Fund, therefore, appears to be 
that established by an Act approved January 28, 1867, which pro- 
vided that the proceeds of the "wild lands" lying within the state 
should constitute a part of the Literary Fund.^^^ Twenty-five 
thousand dollars ($25,000) was realized from the sale of these 
lands.^^^ This fund seems never to have been appropriated for 
common schools. Beginning with the year 1884, its income has 
been expended to support teachers' institutes. 

* See estimate given in account of Permanent Common School Funds of Texas, 
Part II. 

209 Acts, 1859, Chap. 154. 

210 Annual Report, Mass. Board of Education, 1892-93, p. 102. 

211 Act approved Jan. 26, 1839, Laws of the Republic of Texas, 1839, pp. 120-122. 

212 J. J. Lane, History of Education in Texas, U. S. Bureau of Education, Cir- 
cular of Information, No. 2, 1903, p. 27. 

213 Letter to F. H. Swift from J. J. Robinson, Acting Land Commissioner, Oct. i, 
1908. 

214 Constitution of Texas, 1845, Art. X. Sec. 2. 

215 Laws of New Hampshire, 1867, Chap. XLII, Sec. i. 

216 Statement in letter dated July 5, 1907, received from H. C. Morrison, N. H. 
State Supt. PubUc Instruction. 



STATE SOURCES AND ESTABLISHMENT 



85 



The following table shows the area, date, and value of reserva- 
tions of state owned land in so far as the data have been ascertained : 



Table XIV. Lands Originally Belonging to States and Reserved by 
Them for Permanent Common School Funds 



State 


Date 


Area {Acres) 


Proceeds 




Penn. 


1786 
183 1 


60,000 
a 






Conn. 


1795 


3,300,000 * 


$1,200,000 




N. Y. 


1805 
1819 


500,000 * 


400,000 


Lands in the military tract es- 
cheated to the state. * 




1821-55 


991)559 ' 


2,100,000'^ 




Ga. 


1818 






Lots Nos. 10 and 100 in each sur- 
veyor's district. « 


N.J. 








Riparian lands.« An indefinite 
grant. 


N. C. 


1828 






Vacant and unavailable swamp 
lands; moneys paid for entries on 
vacant public lands. os 


Me. 


1828 & 1850 
1868 


726,625 


278,239 


Ten townships. 


Mass. 


1834 


3,500,000 


1,000,000 




Texas 


1839-99 


42,053,059 


50,000,000 


Includes County Funds and Per- 
manent School Fund. Proceeds, 
merely an estimate. 


N. H. 


1867 


a 


25,000 





The moneys and the sources of moneys which the states have 
devoted to their permanent common school funds include licenses, 
state Money escheats, Confiscations, forfeitures, taxes on banks, 

Reservations appropriations. United States debts to the states, 

bank stock, lotteries (New York and Rhode Island), gifts, proceeds 



°- Area unknown. 

* See history of the Permanent Common School Fund of New York, Part II. 
c Under constitution, 1S21, Article VII, section 10. 

<* Report, New York State Superintendent of Public Instruction, 1857, PP- iS, 22. 
All other sources during the same period had contributed less than $1,000,000. 
Ibid. 

* Not including several thousand acres of land to townships for the establish- 
ment of local funds within the township. 



86 PERMANENT COMMON SCHOOL FUNDS 

of funds previously established, supreme court fees (New York), 
slave money (Florida), moneys for exemption from military serv- 
ice, and many others. 

Many states have set apart the proceeds from various classes 
of licenses as original sources from which moneys for the estab- 
Marriage and lishment of their permanent common school funds 

Tavern Licenses were derived or as sources for increasing those 
funds. Delaware, the second state to establish a permanent com- 
mon school fund, provided that the money paid into the state 
treasury on account of marriage licenses and tavern licenses 
between February 9, 1796, and January i, 1806, be and is hereafter 
to be applied under the direction of the legislature for the estab- 
lishment of schools in the state. These licenses constituted the 
sole sources originally provided by the act establishing the Public 
School Fund of Delaware, although at one time the proceeds of 
about nineteen different kinds of licenses were devoted to increas- 
ing the principal of this fund.^^^ 

North Carolina named taxes on liquor licenses and auction 

licenses as two of the sources from which her fund was to be 

derived.^^* Vermont, in the act establishing her 
Liquor, Auction, -. , . , ". 

and Peddlers' fund m 1 82 5, set apart the amount accrued from 

licenses to peddlers as one of the sources of her 
first Permanent Common School Fund.^^^ Rhode Island, by the 
original act which established her Permanent Common School 
Fund, reserved for that fund taxes on auctions.^"'' 

Virginia, the fifth state to establish a Permanent Common School 
Fund, set apart a number of sources of revenue, several of which it 

appears no other state had as yet employed for 

Escheats, Fmes, V r • r 

Gifts, and this purpose : escheats, confiscations, fines, pen- 

alties, forfeitures.^'^ Tennessee, in 1827, passed a 
general school law which consolidated all school funds into one 

217 U. S. Bureau of Education, Circular of Information, 1S93, No. 3, p. 161. 

218 North Carolina Revised Statutes, 1836-37, Chap. 66, pp. 378-379. 

219 Act passed Nov. 17, 1825, Report Vt. State Supt. Ed., 1906, pp. 11, 12. Con- 
sult account given in Part II. 

220 Stockwell, Thos. B., History of Public Education in R. I., p. 45. 

221 Acts of 1809, of Virginia, XIV, Sec. i. 



STATE SOURCES AND ESTABLISHMENT 



87 



Fiaes 



Common School Fund. The sources set aside for this fund include 
escheats, intestate estates, gift of six thousand acres of land and 
bank stock.^^^ 

Not less than twenty-one states have set apart for their per- 
Escheats and manent common school funds the proceeds of in- 

intestate Estates testate estates and of other property, escheating 
to the state. 

At least eight states have provided for increasing their permanent 
common school funds from the proceeds of fines. Indiana, in 
1816, by her constitution, provided that moneys 
paid for exemption from military service or fines 
assessed for any breach of penal laws should be applied to the sup- 
port of county seminaries.^^^ In 1838 gambling moneys were 
added, and later fines for selling salt without having it inspected.^^^ 
The fund thus constituted was known as the County Seminary 
Fund. It was not a permanent fund but merely an annual revenue. 
It was managed by the commissioners of the several counties. In 
1 85 1 it was made a part of the Common School Fund, by the newly 
adopted constitution, and so became a part of the Permanent Com- 
mon School Fund.^^^ The proceeds from fines and forfeitures have 

Table XV. Comparison of Sources Contributing to Indiana School Fund 





Year 


Amount of Fines 


Amount Added by 




and Forfeitures 


Other Sources 




1868 & 


$32,904 


$2,143 




1875^ 


46,339 


3>67S 




i88s« 


49,860 


6,664 




1895 


59,969 


14,867 




1902 " 


43,444 


9,706 




1903 e 


41,433 


12,080 



° The data for the year 1885 are taken from R. G. Boone, History of Education 
in Indiana, p. 189. 

* Report, Indiana State Superintendent of Public Instruction, 1878, p. 80. 

* Ibid., 1906, p. 811. 

222 Laws of Tennessee, 1827, Chap. 64. 

223 Constitution of Indiana, 1816, Art. IX, Sec. 3. 

224 Revised Statutes, Sec. IV, Report Ind. State Supt. of Public Instruction, 
1900, pp. 299-300. 

225 Constitution of Indiana, 1S51, Art. VIII, Sec. 2. 



88 PERMANENT COMMON SCHOOL FUNDS 

added more to the principal of the Common School Fund in Indi- 
ana than the proceeds from the seven other sources provided by 
law. 

Missouri, on February g, 1839, provided that the proceeds of 
fines and forfeitures and other moneys collected within each county 
should be paid into the county treasury for the county school 
fund.^^*^ No provision appears to have been made for making this 
fund permanent until 1868.""'' In 1904 Wisconsin added twenty- 
four thousand, three hundred ninety-one dollars and forty-nine 
cents ($24,391.49) to the principal of her school fund, which sum 
was derived from penal fines/^^ Other states used the proceeds of 
penal fines and forfeitures for the support of schools but did not 
devote them to the permanent common school fund; for example, 
Illinois pays fines and forfeitures to the school superintendents in 
the counties in which they are collected and they are distributed 
by them annually. 

It has already been stated that Tennessee, in providing for her 

state Permanent Common School Fund in 1827, included a gift of 

land. At least nine states have, at one time or 

Gifts ' 

another, provided that the principal of their perma- 
nent common school funds might be increased by gifts not other- 
wise appropriated or gifts made for educational purposes. 

A large number of states, besides Tennessee, have devoted 

bank stock owned by the state to the Permanent 

Common School Fund. Among these may be 

mentioned Vermont, North Carolina, Kentucky, Indiana, and New 

Jersey. 

The proceeds of the direct tax and of war claims returned to the 
states were moneys due them for value received and must there- 
fore be mentioned in this chapter. They have 
been discussed already in Chapter III, which 
should be consulted for a fuller treatment of this topic. 

226 Report Missouri Department of Public Schools, 1903, p. 94. 

227 Act approved Mar. 22, 1868. 

228 Data furnished F. H. Swift, Sept. 12, 1906, by Wisconsin Department of 
Public Instruction. 



STATE SOURCES AND ESTABLISHMENT 89 

Maine, in an act already referred to, by which she estabh'shed 

her Permanent School Fund, provided that all moneys received by 

Maine from Massachusetts on account of war 

War Claims 

claims agamst the United States for services ren- 
dered in the War of 1812 should constitute a part of the original 
principal of this fund. However, the Permanent Common School 
Fund was deprived of this source by a Repeal Act passed March 7, 
j-g^2_229 jjj iSgi the principal of the Massachusetts School Fund 
was increased by twelve thousand forty-three dollars and seventy- 
three cents ($12,043.73), the proceeds of war claims collected from 
the United States, and by six hundred ninety-six thousand, four 
hundred seven dollars and eighty-eight cents ($696,407.88) from 
the United States direct tax of 1861, making a total from these two 
sources of seven hundred eight thousand, one hundred fifty-one 
dollars and sixty-three cents ($708,151.63).^^° 

A number of states have made important additions to the prin- 
cipal of their permanent common school funds, from the proceeds 

of taxes levied upon banks chartered by the state. 

Maryland, in 1813, created her first Permanent 
Common School Fund, the seventh to be established in the United 
States, by an act which levied twenty cents on every one hundred 
dollars of the capital stock of the banks of the state. The proceeds 
were invested in bank stock, a portion of which was placed to 
the credit of the fund itself and the remainder to the credit of the 
several counties."^^ Vermont set apart as one of the sources of 
her School Fund in 1825, moneys accruing from six per cent on the 
net profits of the respective banks chartered by the state.^^^ In 
Chapter III reference was made to moneys which Indiana devoted 
to common schools, derived from the proceeds of taxes on the state 
bank and which were made a part of the Common School Fund in 
1 85 1. Other states have employed bank taxes as a means of 
increasing their permanent common school funds, but as the 

229 Maine School Report, 1901, p. 52. 

230 Fifty-seventh Report, Board of Education of Mass., 1892-93, p. 102. 

231 Laws of Maryland, 1813, Chap. 122; 1S20, Chap. 182. Also Controller's Re- 
port, 1853 and the following years. 

232 Act passed Nov. 17, 1825. 



90 PERMANENT COMMON SCHOOL FUNDS 

national banking system became established in the United States, 
many state banks surrendered their original charters so that revenue 
from this source was diminished. 

In a number of states it is provided that the Permanent Common 
School Fund may be increased from moneys appropriated by the 
State Appro- State. Georgia, in 1817, by an act which estab- 

pnations lished her first Permanent School Fund, set apart 

two hundred fifty thousand dollars ($250,000) for this purpose.^^^ 
Rhode Island established her permanent school fund in 1828 by 
an act which appropriated five thousand dollars ($5,000) as a 
basis for this fund.'-" Massachusetts, in 1894, provided that one 
hundred thousand dollars ($100,000) shall be paid into the Massa- 
chusetts School Fund out of the treasury of the commonwealth until 
the principal of the state fund shall amount to five million dollars 
($5,000,000) .234 

New Jersey in 181 7 provided that one-tenth part of all moneys 

thereafter to be raised for the use of the state should constitute a 

part of the Permanent Common School Fund.^^' 

Taxes ^ 

Texas, by the first constitution adopted in 1845, 

provided as the original principal of the Permanent School Fund 

one-tenth of the annual state revenue derived from taxes.'^^ 

Besides certain sources which have been extensively employed 

by the different states for increasing the principal of their perma- 

nent common school funds, many sources have 

Miscellaneous ■' ^ 

been used by a limited number of states, in many 
cases not more than one state. Thus, in New York, the only 
source by which the principal of the Common School Fund is at 
present increased is twenty-five thousand dollars ($25,000) derived 
from the income of the United States Surplus Revenue Fund.^^^ 
Nevada provided as one of the sources by which her state fund shall 
be increased, two per cent of the proceeds of all toll rates and 
bridges.^^^ 

233 Prince's Digest, 1836, p. 18; also Circular of Information, 1888, No. 2, pp. 24-34- 

234 Resolves of Massachusetts, 1894, Chap. 90. 

235 Laws of New York, 1897, Art. 4, Chap. 413, Sec. 80. 

236 Nevada School Law, 1897, p. 2)Z> Art. XIX, Sec. i. 



STATE SOURCES AND ESTABLISHMENT 91 

Maine, in 1864, provided that moneys derived from the sale of 
grass and timber upon ten townships should be added to the account 
of the principal of the Permanent School Fund.^^' Montana set 
apart as one of the ten sources from which the principal of the state 
school fund may be increased proceeds from the sale of timber, 
stone material or other property from school lands, other than those 
granted for a specific purpose.^^^ Minnesota adds to the principal 
of the Permanent School Fund royalties on iron ore taken from 
school lands.^^^ Many states distribute the rents on lands reserved 
for the Permanent Common School Fund as a part of the annual 
revenue for common schools. Some states add the rents of unsold 
school lands to the principal of the Permanent Common School 
Fund. Among the states which have provided that these rents 
shall be added to the principal of the fund are California,^" Minne- 
sota,24i New Jersey ,^^2 Maine,^^^ and North Dakota.^^^ 

Nebraska,^^^ however, and many other states distribute such 
rents together with the annual revenue for common schools. At 
least two states provided that the principal of their permanent 
common school fund should be increased by balances of the annual 
revenue unexpended during the previous year. In 1906 Maine 
added about three thousand dollars ($3,000) to the principal of her 
fund.^^^ Massachusetts ^^"^ and Rhode Island ^^^ provided that por- 

237 Act Mar. 21, 1864. 

238 Enabling Act, Sees. 10, 11, 13, Montana (Civil) Codes, 1895, Vol. I, p. 
cxxxiii. 

239 Statement furnished Sept. 27, 1906, by J. W. Olsen, Supt. of Public Instruc- 
tion in Minn. 

240 Constitution of California, 1879, Art. IX, Sec. 4. 

241 See note 239. 

242 N. J. School Law, 1903, Sees. 168, 169. 

243 Maine School Law, 1905, p. 40, Sec. 127. 

244 Constitution of N. D., 1889, Art. 9, Sec. 153. 

245 Data supplied Sept. i, 1906, to F. H. Swift, by Neb. State Supt. of Public 
Instruction. 

246 Data furnished July 27, 1906, to F. H. Swift, by Edward Wiggin, Sec. State 
of Maine Education Department. 

247 Public Statutes of Mass. relating to public instruction, including laws in 
force, 1892. 

248 School Law Pertaining to Education, 1896, p. 39. 



92 PERMANENT COMMON SCHOOL FUNDS 

tions of the annual revenue of their permanent common school 

funds forfeited by schools owing to their failure to fulfil the lawful 

requirements for receiving the same, shall be added to the principal 

of the Permanent Common School Fund. 

In presenting the sources which states have devoted to permanent 

common school funds it has been attempted to give them as far as 

it was possible in the order of their development. 
Conclusion ^^ . , , , , . , . 

No reference has been made to their relative 

importance except in the case of Indiana. The fact that a source 
has been provided for increasing the permanent common school 
fund in any state cannot be taken as evidence that the source 
actually does or ever has contributed anything to the funds. Thus 
the constitution of Colorado, 1876, provided five sources from which 
the principal of the Public School Fund might be increased, namely, 
(i) estates escheating to the state, (2) grants, (3) gifts, (4) devises 
made to the state for educational purposes, (5) proceeds of all lands 
granted to the state for educational purposes by the United States. 
The fifth source is the only one from which anything has ever been 
added to the principal of the Public School Fund.^"^^ In Indiana 
eight sources have been set aside for increasing the principal of the 
Common School Fund. Most of these sources have never contrib- 
uted anything, and at present only three of them, fines, forfeitures, 
and estrays, do contribute anything. 

This topic will be considered somewhat more fully in Chapter V, 
in connection with the topic of loss and diversion of the perma- 
nent school funds. There it will be shown that in some cases 
sources provided by the constitution have never become effective, 
owing to the failure of the legislature to enact necessary laws. The 
failure is sometimes due to the fact that the legislation which exists 
is not complete; for instance, in some states where it has been pro- 
vided that escheats should be devoted to the permanent school 
fund, the law does not specify the period of time after which such 
property shall be claimed by the state. It will be shown that some 
funds lose annually many thousands of dollars for such reasons 

249 Statement from Katherine L. Craig, State Supt. of Public Instruction of Colo. 
See account in Part II, 



STATE SOURCES AND ESTABLISHMENT 93 

as these. More careful and thoroughgoing legislation is needed in 
many of the states. In the following chapter will be discussed 
the various modes which have been employed for the management 
of these funds and the losses which they have suffered. 

Having described the sources both federal and state out of which 
the public permanent common school funds have been created 
steps in the ^.nd by which they have been increased, it is now 

stlTe^pSSlnlnt fitting to give some account of the steps by which 
School Funds ^^e funds became established in the several states 

and the relative order in which they were established. Every 
fund created by the original states and the states carved out of 
them has a history peculiar to itself. On the other hand, permanent 
school funds created out of the proceeds of the sales of federal land 
grants were established in a comparatively uniform manner. The 
acts and resolutions relating to the federal land grant to Ohio, 
quoted in Chapter III, reveal the steps involved in establishing a 
permanent school fund in a public land state. Allowing for varia- 
tions in individual states, the more important steps may be stated 
as follows: (i) Congress passes a law providing a territorial govern- 
ment for a certain area. By this law the school sections in each 
township are reserved; (2) Congress passes an act known as the 
Enabling Act, authorizing the territory to form a constitution. In 
this Enabling Act Congress offers propositions granting school, 
university and other lands upon certain conditions; (3) the consti- 
tutional convention meets and embodies these propositions and 
conditions in the constitution or in some ordinance attached to 
the constitution which becomes accepted or adopted by the state; 
(4) After the admission of the state into the Union legislation is 
enacted carrying out the provisions of the constitution; (5) the lands 
are thereupon either sold or leased; (6) the proceeds of the sales 
or rents are covered into the treasury and thence withdrawn and 
invested. The rent from the leased lands is distributed by some 
states annually among the schools of the state together with the 
income of the invested principal. In some states, however, land 
rents are added to the principal. 

The purchasers of school lands, like the purchasers of other pub- 













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STATE SOURCES AND ESTABLISHMENT 95 

lie and state lands pay a certain fraction of the price at the time of 
the sale, the remainder in instalments with interest on the portion 
unpaid. As a result, the permanent common school fund in a 
public land state consists, prior to the exhaustion of school lands, 
of two parts: first, unsold school lands, and, second, moneys 
derived from the sale of school lands. The annual income is 
derived chiefly from some or all of the following sources : interest 
on the invested principal, interest on deferred land payments, rent 
on leased lands, royalties on ore, moneys derived from hay, timber, 
or stone permits. 

Having described the sources out of which the various states 
created their public permanent common school funds and the steps 
Order of Establish- involved in the establishment of these funds, it 
CommonSor''* ^^ now proper to show the order in which the 
^^^^ different states established their funds. Uninter- 

esting as this topic may appear, several vital questions lie within 
it. But these questions cannot be discussed here. The most that 
can be done within the remaining limited space of this chapter is 
to show how early in the history of our nation, men interested in 
education gave serious consideration to the policy of supporting 
public schools in whole or in part from the income of public per- 
manent endowments. The order of establishment of permanent 
school funds shows also with what rapidity this policy spread and 
was adopted until it became practically universal. The spread and 
adoption of this, was the beginning of the spread and acceptance 
of the principles of free and democratic education. That this is 
true will appear in Chapter VI. 

As stated in Chapter II of this Part, Georgia, by an Act passed 
July 31, 1783, attempted to provide for the establishment of a 
_,. , T^_ , , fund for the support of free schools in each of the 

First Efforts to ^'^ 

Establish Per- respective countics of the state, by a grant of one 

manent Common jo 

School Funds thousand acres apiece, but this act did not result 

in the establishment of permanent funds. The 
New York legislature, in 1786, had provided that in townships 
subsequently to be surveyed one lot should be reserved, thereafter 
to be applied by the legislature for promoting literature in the 



96 PERMANENT COMMON SCHOOL FUNDS 

state.^^° The fund created by the sales of these hterature lands 
was the first permanent fund established by any state, but its 
purpose was to aid, not common schools, but academical depart- 
ments for the preparation of teachers. As stated in the first part 
of this chapter, Pennsylvania, as early as 1786, endeavored to 
establish a permanent common school fund by setting apart for 
this purpose sixty thousand acres (60,000) of unappropriated state 
lands.^°^ But the public schools appear to have derived no aid 
from this act. The proceeds of these lands probably were given 
to aid county academies.^"^ The first state to establish a permanent 
fund for the support of common schools was Connecticut which 
did so in 1795.*^ Delaware followed the next year.^^^ It was ten 
years after the establishment of the School Fund of Connecticut 
that New York created a permanent fund for common schools.^*^ 
Five years later, 1810, Virginia established her Literary Fund, 
being the fifth state in the Union to establish a common school 
fund.^^^ During the next fifteen years most of the other thirteen 
original states established such funds. Massachusetts attempted 
to maintain her schools without the aid of a permanent fund, and 
with the exception of New Hampshire which offers a special case, 
was the last of the thirteen original states to establish a permanent 
common school fund, doing so in 1834.^^ 

It may be said, therefore, that by the year 1834, the policy of 
establishing permanent common school funds had been accepted 
by the original states. Meanwhile, seven public land states had 
been admitted into the Union as follows: Ohio, 1802; Louisiana, 
1812; Indiana, 1816; Mississippi, 1817; Ilhnois, 1818; Alabama, 
1819; Missouri, 182 1. Each of these seven states had received 
its grant of sixteenth section school lands, but these lands were 
originally, upon the states' admission into the Union, granted to 
the townships, and did not, therefore, result in the establishment 
of a fund controlled by the state. It is true that in many instances 
what were at first township funds, have been merged into single 

250 Laws of New York, 1786, Chap. 67. 

251 Act passed Feb. 9, 1796. 

252 Act passed Feb. 2, 1810. 



STATE SOURCES AND ESTABLISHMENT 97 

funds controlled by the state. Thus Alabama, admitted in 1819, 
provided in 1828 that the proceeds of sales of sixteenth section 
lands should be paid into the state treasury and the state should 
become trustee of the fund and liable to pay the districts and town- 
ships interest on the principal at the rate of six per cent.^^^ Illinois, 
by legislation enacted between 1818 and 1821, had established a 
state controlled fund entitled School Fund Proper.* Indiana, in 
the year 1834, established the Saline Fund as a permanent fund for 
common schools, managed by the state.^^^ In the case of Indiana 
this fund had existed since 1816, but it was not until 1834 that pro- 
vision was made for making it a permanent, state-controlled source 
of school revenue. 

Besides the original states and public land states, Vermont, 
Kentucky, Tennessee, and Maine had been admitted into the Union 
previous to the year 1834. Three of these states had provided for 
the establishment of a permanent common school fund; Kentucky 
in 1821,25^ Vermont in 1825,2^9 and Maine in 1828.20° -pable XVI. 
which follows here, shows the order in which the different states 
established their permanent common school funds, and the order 
in which they were admitted into the Union. Table XVII is 
added for reference. It presents the states of the Union in alpha- 
betical order and attempts to show every public permanent com- 
mon school fund ever established by any state. It includes there- 
fore lost funds as well as credit and intact funds. It shows also 
whether the fund was first provided for by act of legislature or by 
constitution, and, further, the original sources out of which the fund 
was created. In order to avoid misconception regarding the data 
presented under the heading '' Original Capital or Principal," refer- 
ence should be made to foot-note 43 in Chapter I, and to foot-note 
(g) accompanying Table XVII. 

* See account given in Part II. 

253 Laws of Alabama, 1828, Chap. 26. 

254 Boone, R. G., History of Education in Indiana, p. 186. 

255 Acts of Kentucky, 1821, p. 35, Chap. CCLXXXIV, approved Dec. 18, 1821. 



98 



PERMANENT COMMON SCHOOL FUNDS 



Table XVI. Public Permanent Common School Funds Arranged in the 
Order of Their Creation 1795-1905 * 



States and 


Titles 


Created 


Mode 


Date Ad- 
mitted in- 


Territories 








to Union 


I. Conn. 


School Fund 


1795 


Act 


O-t 


2. Del. 


Public School Fund 


1796 


Act 


0. 


3. N. Y. 


Common School Fund 


1805 




0. 


4. Tenn. 




1806 


Act 


1796 


5. Va. 


Literary Fund 


1810 


Act 


0. 


6. S. C. 




1811™ 




0. 


7. Md. 


Free School Fund 


1813 ^ 


(1812, Act) 


0. 


8. Ind. 


Congressional Township 
Fund 


1816 


Constitution « 


1816 




Saline Fund « (1S16, 


1834 


Established as Per- 






Const. «) 




manent School Fund 




9. Ga. 


Permanent School Fund « 
(1783) 


1817 <i 


Act 


0. 


10. N. J. 


Permanent School Fund 


1817 


Act 


0. 


II. 111. 


Township Fund 
School Fund Proper 


1818 
1818-21 


Const. Ordinance 


1818 


12. Ky. 


Literary Fund <^ 


1821 


Act 


1792 


13. Miss. 


Literary, or, i6th Section 










(Choctaw Fund) 


1821 * 


Act 


1817 




Chickasaw Fund 


1843 


Act 




14. N. H. 


(Literary Fund ^) 


(1821)* 


Act 


0. 


15. N. C. 


State Literary Fund 


1825 


Act 


0. 


16. Ohio 


Irreducible Debt 


1827 


Act 


1802 


17. Vt. 


(School Fund) 


(1825) 


Act 


1791 


18. Ala. 


Sixteenth Section Fund 


1828 


Act 


1819 



" Later merged with other funds to form state permanent common school fund, 
or in some cases lost; in any case not the creation of the present fund. 

' Georgia has at present no permanent fund; though several productive sources 
of revenue are devoted to schools. 

^ Date inclosed in parenthesis is year when first steps were taken toward creation 
of fund. 

« Constitutional creation must be supplemented by legislation. In some cases 
effective legislation did not follow for some years. * Very largely a lost fund. 

* The fund created in 1821 was not a permanent fund. 
^ Complete and reliable data not available. 

* The purpose of this table is to show the chronological order in which the states 
stand with respect to establishing permanent funds. Many funds are not included. 
Table XVII shows all funds ever created. f O., i. e., one of the original states. 

( ) Parenthesis around name of fund indicates that the fund has been lost, or 
has been merged with other funds later. 



STATE SOURCES AND ESTABLISHMENT 



99 



Table XVI — continued 



States and 
Territories 









Date Ad- 


Titles 


Created 


Mode 


mitted in- 
to Union 


Permanent School Fund 


1828 


Act 


1820 


Permanent School Fund 


1828 


Act 


0. 


Common School Fund 


183 1 


Act 


0. 


Mass. School Fund 


1834 


Act 


0. 


(Sixteenth Section Fund «) 


1836 


Act 


1836 


Primary School Fund (1835) 


1837 1 


Constitution 


1837 


(Sixteenth Section Fund) 


183s 


Act 




Public School Fund 


1837 


Act 


1821 


County School Funds 


1839 


Act of Texas Rep. 


1845 


Permanent School Fund 


1845 


Constitution 




State School Fund * 


1845 


Constitution « 


1845 


(Perpetual Fund '^) 


(1S45) 


Constitution 


1812 


Permanent School Fund 


1846 


Constitution 


1845 


School Fund 


1848 


Constitution « 


1848 


Sixteenth Section Fund « 






1850 


Perpetual School Fund 


1850 


Constitution « 




Permanent School Fund 


1858 


Constitution « 


1858 


|- Swamp Land Fund 


1908 


Swamp Land estab- 
Hshed, 1881, Const., 
art. 8, sec. 2 * 




Common School Fund 


1859 


Constitution « 


1859 


Permanent School Fund 


1861 


Constitution « 


1861 


School Fund 


1863 


Constitution * 


1863 


State School Fund 


1864 


'Constitution « 


1864 


Permanent School Fund 


1866 


Constitution « 


1867 


Public School Fund 


1876 


Constitution « 


1876 


Public School Fund 


1889 


Const. Ordinance « 


1889 


Permanent School Fund 


1889 


Constitution « 


1889 


Permanent School Fund 


1889 


Constitution « 


1889 


Common School Fund 


1889 


Constitution « 


1889 


Public School Fund 


1890 


Constitution « 


1890 


Common School Permanent 


1890 


Constitution « 


1890 


Fund 








State School Fund 


1895 


Constitution « 


189s 
1907 
1910! 


Permanent Fund 


1898 


Congressional Grant 


igiof 



19. Maine 

20. R. I. 

21. Penn. 

22. Mass. 

23. Ark. 

24. Mich. 

25. Mo. 

26. Texas 

27. Fla. 

28. La. 

29. Iowa 

30. Wis. 

31. Cal. 

32. Minn. 



33. Ore. 

34. Kan. 

35. W. Va. 

36. Nev. 

37. Neb. 

38. Col. 

39. Mont. 

40. N. Dak, 

41. S. Dak. 

42. Wash. 

43. Id.' 

44. Wy. 

45. Utah 

46. Okla. 

47. Ariz. 

48. N. Mex, 



^ Originally intrusted to the townships, merged and intrusted to the state in 1S48. Table XVII 
gives this later year as year of creation. 

•Nothing derived from this fund was devoted to common schools till following legislation of 1907. 

t This table does not include funds established after 1907. Arizona and New Mexico, upon admission, 
will create permanent funds. 



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-I •_§ O (u C/) >-l 



CHAPTER V 

MANAGEMENT OF PUBLIC PERMANENT COMMON SCHOOL FUNDS 

The question whether the Permanent Common School Fund was 

owned and should be managed by the state or by smaller units 

such as towns and counties was easily settled in 

Question of -^ 

Township Versus Connecticut, New York, Massachusetts and other 

State Management i i r i i i 

states where the fund was created by an act of 
the legislature and did not arise from the proceeds of the sale of 
township lands. But in states to which had been granted federal 
lands for schools, the question at once arose whether these lands 
belonged to the township or to the state, and if to the township, to 
what extent the state could supervise or control the management. 
The first funds of sixteenth-section-lands origin were regarded as 
belonging to the townships and managed by the townships or the 
state or county for the township. However, a tendency to regard 
the state as the lawful owner and manager soon appeared and 
eventually triumphed. Every state, since the admission of Minne- 
sota in 1858, has devoted its township lands to a public, perma- 
nent, state-controlled school fund. 

Four distinct stages are evident in the transition from township 
to state management. In the first stage the lands are regarded as 
Four stages in the property of the township in which they are 
fi^om ^wnship to located and the funds derived from them are 
state Management managed by the respective townships. 

In the second stage township ownership continues, but the funds 
are managed for the respective townships by the several counties 
in which the townships lie. In this stage the township funds are 
kept separate, and each township receives an income proportionate 
to the fund intrusted by it to the county. 

The third stage is like the second in most respects except that the 
state, instead of the county, manages the funds for the townships. 

107 



io8 PERMANENT COMMON SCHOOL FUNDS 

In the fourth stage, the township lands are declared to belong 
to the state. The state manages the lands, creates a fund derived 
from their proceeds, and distributes the income of this fund among 
the counties, townships, or districts in proportion to their school 
population, average attendance or upon some other general basis 
deemed just and equitable. 

In this as in other evolutionary processes the stages do not appear 
in chronological order. Thus, the lirst state to receive a grant of 
the sixteenth section lands, Ohio, represents the third stage. Hav- 
ing described the stages, it is now possible to discuss them in the 
order in which they arose. 

Each of the following states regarded, and continues to-day to 
TownGhip regard the sections lying within the townships as 

Ownership belonging to the same, and administers the fund 

derived therefrom as township funds: 

Ohio, admitted in 1802.-'^^ 

lUinois, admitted in 181 2.-^'* 

Indiana, admitted in 1816."'^^ 

Alabama, admitted in 1819.'^'^ 

Louisiana, admitted in 1820.^'^'^ 

Missouri, admitted in 1821.-*^^ 

The Enabling Act of Ohio, quoted in Chapter III, reads in part, 
"And be it further enacted, . . . that the section numbered six- 
Township Owner- teen in every township . . . shall be granted to 
Management? the inhabitants of such township for the use of 

*^^*° schools." This form of grant unquestionably 

makes the township the true owners of the school lands, but an 
Act of Congress passed March 3, 1803, granting school lands for 

262 School Laws of Ohio, iSgS, compiled by State Commissioner of Common 
Schools. 

2(53 Report Ind. Supt. of Public Instruction, iSgS, p. 60. 

2M School Laws of 111., 1903, Art. Ill, Sec. 34. 

205 Data furnished Jan. 8, 1907, by I. W. Hill, Ala. State Supt. of Education. 
The state holds these funds in trust for the townships. Cf . account given in Part II; 
also Ala. School Law, 1S95, Chap. 4, Sec. 1007. 

2<i6 Compilation of laws of La. relating to Free Public Schools, 1904, Sees. 2957, 
2963, pp. 56, 60. 

267 Mo. School Law, 1903, p. 57, Sec. 9S29. 



MANAGEMENT OF SCHOOL FUNDS 109 

portions of Ohio unprovided for in the Enabhng Act, vested in 
trust in the legislature all lands appropriated by the United States 
for the support of schools.^*^^ 

The legislature doubted its right to sell the school lands and 
passed an act to lease them for ninety-nine years. This proved 
unsatisfactory and application was made to Congress for permission 
to sell the school lands. Congress made no reply to this request. 

"The legislature felt the necessity of doing something, and accordingly in 
January, 1827, passed an act for the sale of the school lands, with such con- 
ditions as avoided any question of right as regards the people for whose benefit 
the lands were held. It was provided, first, that the sale of section sixteen, 
in the original surveys, should be voted on by the people of the township, 
and the sale made if they decided so; second, the lands were to be appraised 
and not sold below the appraisement; third, on full payment of the money, a 
deed in fee simple was to be made by the state. The same policy was adopted 
in reference to all the school lands." ^oa 

"The money derived from the sale of school lands was used for other pur- 
poses (than schools). As such moneys came into the state treasury they were 
accredited to the original township in which the lands lay, and deposited in a 
so-called sinking fund. The interest on that amount then goes annually to the 
school districts located all or partly in the original township. The interest is 
raised by state levy. The rent of unsold school lands is added to the annual 
revenue." 2^0 

Mississippi, admitted in 1817, has pursued a twofold pohcy. The 
state holds in trust for the Chickasaw counties, a fund on which it 
pays annual interest to these counties, keeping a separate account 
for each township. -'^^ The sixteenth section lands belonging to 
the Chocktaw counties were in some cases sold outright prior to 
1833, and the proceeds eventually lost. Others were leased for a 
term of ninety-nine years."'^" 

Alabama followed a policy similar to that pursued by Ohio by 

268 Statutes at Large, Vol. II, p. 225. 

269 "Ed. Land Policy of the U. S.," Barnard Am. Journal of Ed., Vol. 28, pp. 936, 
937- 

270 School Laws, compiled by Slate Commissioner of Common Schools, 1898, 
Sec. 3953. 

271 Report Miss. State Supt. Ed., 1S94-95, p. 24; School Laws of Miss., 1896, 
p. 41, Sec. 4150. 

2K Report Miss. State Supt. Ed., 1S71, p. 37. 



no PERMANENT COMMON SCHOOL FUNDS 

providing in 1828 that the sixteenth section lands granted by Con- 
gress should be sold and the proceeds paid into the state treasury, 
the state becoming a trustee of the funds and liable to the districts 
and townships for the interest on the principal at six per cent. 
The proceeds of the sixteenth section lands when sold are placed 
to the credit of the township from which they were received.^'''^ 

In Illinois the funds derived from the proceeds of the sales of 
the sixteenth section lands are managed by the respective town- 
ships, the township treasurer being the custodian of the fund,^®"* 
but the school fund proper and the title to these townships fund 
is vested in the state.^'^^ 

Tennessee appears to have been one of the first states which 
merged the proceeds of the sales of the school lands granted by the 
Evolution of State federal Government into a public permanent com- 
TemfelseeT"* "^ T^o^ scliool fund, owned and managed by the 
1806-1827 state. It was noted in Chapter III that although 

Tennessee was the first state in which the federal Government 
owned lands to be admitted into the Union, no school lands were 
granted it until 1806, ten years after its admission.* In the case of 
Ohio the sixteenth section was definitely located by the United 
States survey system and given to the inhabitants of the township in 
which it lay. But Tennessee had not been covered by the congres- 
sional survey system, therefore, townships were not yet surveyed 
in a large part of the state and the school sections granted by Con- 
gress could not be located accurately. The result was that the 
congressional grant of 1806 gave Tennessee the public lands lying 
within the state, on which the Indian title had been extinguished 
and directed that 

"The state of Tennessee shall, moreover, in issuing grants and perfecting 
titles locate 640 acres to eveiy square mile in the territory hereby ceded where 
existing claims will allow the same, which shall be appropriated for the use 
of schools for the instruction of children forever." 274 

* Chapter III, p. 53. 

273 Statement to F. H. Swift, Sept. i, 1906, from F. G. Blair, 111. Supt. of Public 
Instruction. 

274 T. P. Thomas, The Public School System of Tennessee, U. S. Bureau of Ed,, 
Circular of Information, No. 5, 1893, pp. 282-283. 



MANAGEMENT OF SCHOOL FUNDS lii 

The important thing to notice here is that there was no provision 
in the Tennessee congressional grant of 1806 which made the 
school lands the property of the townships. 

In 1806 the state provided that the newly acquired lands should 
be surveyed and laid out " so as to form sections as near six miles 
square as the case will admit," ^"^^ The policy pursued from 1806 
to 1824 was to lease the common school lands through commis- 
sioners appointed by the county courts. The commissioners were 
empowered to use the rent to erect a school-house and provide a 
teacher .^''^ Here is represented the second stage, — county manage- 
ment. In 1825 an act was passed providing for the sale of the 
school lands/'^'^ but an act passed the following year postponed 
the sale until certain suits regarding the title to the lands should 
be settled.^^^ In 1827 a law was passed which consolidated all 
school funds into one, entitled ''The Common School Fund," ap- 
propriated to the encouragement and support of schools forever." ^^^ 

The absence of provisions in the text of the Tennessee grant 
made easy the transition from county to state management. But 
that it was not the definite intention of Congress to provide for the 
establishing of state funds at the time of the admission of Tennessee 
nor for some time after, seems to be shown by the form of grant 
made to Illinois. In this grant section numbered sixteen in each 
township is granted to the state for the use of the inhabitants of 
such township for the use of schools.^®^ 

It was not until the admission of Michigan, in 1836, that a 
state Management grant was made in a form which could be inter- 
o/coifgres^onai™ prctcd as giving the common school lands to the 
Grant, 1836 ^^^^^ ^^^ ^^^ ^^ ^j^^ townships. The Michigan 

grant reads in part, 

275 Laws of Tenn., 1806, Chap. I, Sees. 1-6; Haywood & Cobb's Digest, 1S31, 
pp. 44-52. 

276 Laws of Tenn., 1S17, Chaps. 67, 125, Sees. 7-11; Ibid., 1821, Chap. 67. 

277 Laws of Tenn., 1825, Chap. 85. 

278 Ibid., 1826, Chap. 64. 

279 Ibid., 1827, Chap. 64. 

2S0 Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report U. S. Commissioner of Education, 1S92-93, II, p. 1271. 



112 PERMANENT COMMON SCHOOL FUNDS 

"Section numbered sixteen in every township within said state . . . shall 
be granted to the state for the use of schools." ^si 

The policy followed by Michigan has been to use for general 
purposes all moneys received by the state in whole or part payment 
upon school lands and to establish an account of a Permanent 
Common School Fund. Michigan has two such accounts on one of 
which she pays seven per cent annual interest and on the other 

It may seem that the form of the Michigan grant and the policy 

subsequently pursued by this state ought to have settled for the 

states admitted thereafter the question of owner- 
Michigan Policy 
Fails to Establish ship and management. But while it may have 

Precedent i i i i 

hastened the tendency towards state management, 
it failed to establish a fixed precedent, as will be seen by glancing 
at the policies pursued by Arkansas, Florida, California and some 
other states. 

Arkansas, admitted in 1836, the same year in which the Michigan 

grant gave the township lands of that state to the state itself, 

regarded the sixteenth section lands as belonging 

Change from ^ . . ^ ^ 

Town to State to the townships and constituted the fund derived 

Management . r i t or. 

from their proceeds a separate fund, in 1889 
the sixteenth section fund of Arkansas was merged with the perma- 
nent fund established in 1868.^®^ 

Florida, admitted in 1845, at first regarded the sixteenth section 
lands as belonging to the townships. "It was not the original 
intention that the sixteenth section lands should be sold and merged 
into a common fund, but rather that . . . such section should 
confer its benefits upon the township alone to which it belonged." ^^^ 
But the indifference of the towns and their failure to make use of 
the sixteenth section lands led the legislature in 1848 to enact that 
the register of public lands should provide for the sale of the 

251 Statutes at Large, Vol. V, p. 59. 

252 Report Supt. of Public Instruction of Mich., 1903, pp. 22-24. 

283 Report Ark. State Supt. of Public Instruction, 1899-1900, p. 28; Report 
U. S. Commissioner of Education, 1892-93, p. 1361; Constitution, 1868, Art. 9, 
Sec. 4. 

284 U. S. Bureau of Education, Circular of Information No. 7, 1S88, p. 20, note 2. 



MANAGEMENT OF SCHOOL FUNDS 113 

townsnip lands, and that the proceeds should be paid into the state 
treasury for the estabhshment of the Permanent State Common 
School Fund.^^'* The state school fund of Florida is to-day managed 
by the Board of Education/^^ 

Iowa, admitted in 1846,^^'^ and Wisconsin, admitted in 1848,^^^ 
provided upon admission into the Union that the proceeds of the 
state Management, Sixteenth section lands should be devoted to a 
Iowa and Wisconsik permanent common school fund controlled by the 
state. Nevertheless, this form of management was not yet an ac- 
cepted policy, for California, admitted in 1850, left the control of 
the sixteenth and thirty-sixth section lands with the respective town- 
ships in which they lay, and it was not until 1861 that provision 
was made for constituting these funds a part of the state permanent 
common school fund.^^^ 

Minnesota was the next state to be admitted after California. 
The question of state versus township ownership 

Minnesota 1 1 1 • 

Establishes State of the school Sections was debated carefully and 

Management, 1858 . . , . , , , 

earnestly at the constitutional convention held 
July 13, 1857. 

"Prominent at this convention was the question whether, inasmuch as the 
public lands were designated as sixteenth and thirty-sixth sections of each 
township, the revenue accruing should not be administered by the township 
authorities for the support of the schools of the township in which the lands 
were located. In favor of this policy two reasons were urged: First, that 
instead of appropriating the lands in bulk as they were for the university they 
had been distributed in tov/nships, which would seem to indicate that they 
were for the use of the respective townships in which they were located. 
Second, that to put all these lands under the control of an administration 
located at St. Paul savored too much of centralization by removing them too 
far from the people. This view was supported by the recent experience of 
our nearest neighbor, Wisconsin, where through the mismanagement and 
defaulting of state officers, the lands were sold at nominal prices to specu- 
lators." 289 

285 Constitution of Fla., Art. XII, Sec. 4, as amended 1894. 

286 Constitution of Iowa, 1846 Art. IX, Second. 

287 Constitution of Wis., Art. X. 

288 Report Cal. State Supt. of Public Instruction, 1864-65, p. 249. 

289 Kiehl, History of Education in Minn., pp. 17-18. 



114 PERMANENT COMMON SCHOOL FUNDS 

The following are some of the schemes advocated at the consti- 
tutional convention for disposing of the school lands: 

"i. That each county should be made a guardian of the school lands 
within its own limits." Reply: The lands are of veiy unequal value in the 
diflferent counties, while it was the design of the donor (U. S.) that the income 
be apportioned equally among the public school children of the state. 

2. That settlements might be made upon school lands in a way that would 
secure to settlers the value of their improvements and the right to buy in 
preference to others. These dangerous measures were finally lost. 

3. Another plan well calculated to encourage bribery and facilitate loss to 
the school funds was that whenever lands were to be offered for sale the super- 
intendent of public instruction should appoint appraisers to fix a minimum 
price of parcels to be ofiFei"ed at public auction.^ao 

The question of ownership and management was finally settled 
by placing the disposition of the sixteenth and thirty-sixth section 
lands and the management of their proceeds in the hands of the 
state to constitute a part of the permanent school fund. Every 
state admitted into the Union since Minnesota, has followed her 
example. It may be said that Minnesota in 1858 completed the 
establishment of the policy of state management of township lands 
and funds arising from the sale of the same. 

Many states which originally regarded the sixteenth and thirty- 
sixth section lands as belonging to the townships later sought to 
merge the township funds into a common fund controlled by the 
state. It has already been shown what Alabama, Arkansas, and 
Mississippi did in this direction, but how they fell short of taking 
the final step. Tennessee, in 1827, and Florida, in 1848, are among 
the states which completed the transition from local to state owner- 
ship as well as management of these funds. Indiana, in 1851, by 
constitution adopted that year, sought to establish one state con- 
trolled fund for common schools, known as the Common School 
Fund, and included in this fund the Congressional Township Fund, 
but the Supreme Court in 1854 decided that the sixteenth section 
lands were the property of the townships and consequently could 
not be merged with the Common School Fund.^^^ 

Three forms of management or policies of administration arose 
280 Report Minn. Supt. of Public Instruction, 1878, p. 35. 



MANAGEMENT OF SCHOOL FUNDS 115 

out of the transition from township to state management just de- 
scribed, and there still exist three forms or policies of administra- 
Different Existing tion of public permanent common school funds, 
men?f Town^Wp,^' namely, township, county, and state. A sufficient 
County, state number of examples of the first and third forms has 

been given, but little has been said concerning county management. 

Texas, admitted as a state in 1845, continued and still con- 
County tinues ^^^ to maintain as county funds the perma- 

Management ^^^^^ common school funds the Republic of Texas 

had provided for in 1839.^^^ 

In Missouri four classes of permanent common school funds 
and consequently four forms of management exist: state, county, 
township, and district. The Public School Fund is managed by 
the state,^^^ the county and township funds are managed by the 
county courts of the respective counties.^^"* The County School 
Fund of Missouri wa-s provided as an annual source of school rev- 
enue in 1839.^^^ In 1868 it was established as a permanent fund.^®' 
In South Dakota and in some of the other states the principal of 
the permanent school funds is distributed among the counties which 
hold and manage their shares as trust funds but are responsible 
to the state for the inviolate preservation of the same.^^'^ The Mary- 
land Free School Fund is managed by the boards of county school 
commissioners.^^^ In Iowa the general management of the Perma- 
nent School Fund is confined to the auditor of the state.^^^ Prior 
to 1874 the State Superintendent of Public Instruction had charge 
of loaning the proceeds. Since that time. the fund has been handled 
by the county boards of supervisors of the counties which are 
responsible for all loss.^"*^ 

291 Constitution of Texas, 1883, Art. 7, Sees. 4, 6. 

292 Laws of the Republic of Texas, 1839, pp. 120-122. 

293 Revised School Laws of Mo., 1903, p. 57, Sec. 9822. 

294 Ibid., p. 59, Sec. 9829. 

295 Report Mo. Supt. of Public Schools, 1903, p. 94. 

296 Act approved Mar. 27, 1868, Sec. 18. 

297 Constitution of S. Dak., 1889, Art. 8, Sec. 11. 

298 Md. Public School Laws, 1892, Chap. 20. 

299 Report Supt. Public Instruction of la., 1875, P- S^- 
3W Data furnished by State Auditor, Nov. 15, 1906. 



ii6 PERMANENT COMMON SCHOOL FUNDS 

In Indiana the Common School Fund and Congressional Town- 
ship Fund are distributed among the counties who manage them 
through their respective auditors. The school funds are managed 
by the counties and loaned at six per cent on mortgaged real estate 
situated in the county.^"^ When the Common School Fund of 
Indiana was established in 1851 by merging several already exist- 
ing funds, these funds were not deposited in the state treasury but 
were allowed to remain distributed among the counties which, 
however, have since paid the revenue into the state treasury whence 
it is reapportioned among the counties. 

The following chapter will be given over chiefly to a considera- 
tion of the losses suffered by the public permanent common school 
funds under the different forms of management just described. 
But it may be well to point out first in a general way some of the 
defects of each of these forms and then, at least, state the more 
important forces which tended to bring about the adoption of the 
policy of state ownership and management. 

The defects of township management will be readily and clearly 
seen in the account which follows of the losses suffered by such 
Defects of Town- funds. The general defects may be summarized 
ship Management ^g foUows: (i) sacrifice of the school funds to 
local interests; (2) carelessness and incompetency in management; 
(3) lack of responsibility to any higher authority; (4) proceeds of 
sales of school lands lost or applied to other objects; (5) inadequate 
legislative protective provisions. 

The defects in county management may be summarized in 
Defects of County almost the same words as those of tov/nship man- 
inu^tot™d by agement. The evils arising in connection with 

Missouri ^]-|jg fQj-j-Q Qf management in Missouri are to be 

found in other states.* 

In 1870 the Superintendent of Public Instruction of Missouri 
wrote : 

"Had the funds been properly taken care of, the income from this source 
[the permanent school fund] would be sulTficient to sustain the schools for at 

* Cf. Account of Loss of Surplus Revenue Fund in New York. 
301 Report Supt. Public Instruction of Ind., 1S90, p. 40. 



MANAGEMENT OF SCHOOL FUNDS 117 

least six months in the year. . . . To say that these funds have been grossly 
and shamefully diverted from their original purpose is putting the case in a 
mild form. Many of the county courts in utter disregard of the trust imposed 
upon them, have not only allowed the funds and lands to be used for pur- 
poses foreign to their original purpose, but in many instances have entered 
into combinations with corporations and individuals to so manage these 
moneys and lands that they have fallen into the hands of private parties. 
An act was passed last winter to recover these lands. The provision of the 
act itself defeats the very object for which it was enacted. In nearly every 
instance where lands have been disposed of not in accordance with law, the 
blame rests with the county court. By provision of the act above referred to, 
where lands are recovered by suits instituted by attorneys appointed under 
the act, they shall be allowed such sums for their services as may be deemed 
reasonable by the county courts of the county in which the lands recovered 
are situated. 

"The county court is not going to stultify itself by first making an unau- 
thorized sale of lands, and then pay counsel to show that the contract they 
have made is void. . . . They will employ counsel to defend their action. . . . 
There is a criminal responsibility resting somewhere for the gradual wasting 
away of the public school fund." 302 

Three causes which furthered the adoption of state versus local 

ownership and management of funds derived from the proceeds of 

a. J. X township lands may be named: (i) mismanage- 
Fore es Tending to '- -^ ^ ' ° 

State Ownership ment and loss of funds under township control; 

and Management 

(2) unequal value of lands in different townships; 
(3) growth in general tendency toward centralization and the desire 
to unify the school system. 

One of the most potent forces tending toward state management 
was the diverse character of the school lands. In many states 
Unequal Value lands lying in different townships were of very 
of School Lands unequal value. Superintendent Larrabee of Indi- 
ana, in his report in 1853, wrote: "In some townships the sixteenth 
section happened to be valuable, in other townships it fell on barren 
highlands or in the swamp." The Superintendent of Colorado 
in the report for 1901-02, page 617, wrote: "The sections set 
aside for schools in Colorado represent lands of every class from 
the highest grade of mineral and agricultural lands to the compara- 

302 Mo. Public School Report, 1870, p. xi. 



ii8 PERMANENT COMMON SCHOOL FUNDS 

tively worthless arid lands, fit for grazing purposes only, and 
in many instances too barren and desolate even for this pur- 
pose." 

There are at present in California about four hundred thousand 
acres of unsold school lands, but Controller A. B. Nye states that 
it is doubtful whether anyone would buy these lands as a whole at 
one dollar and twenty-five cents per acre. Almost all of these 
lands are "in the mountains, inaccessible and of little value." ^°^" 

Nevada presents an interesting exception to the rule. This 

state accepted in lieu of sixteenth and thirty-sixth section lands in 

each township, two million acres to be selected 

Nevada Policy . i , • • , 

by the state. The sixteenth and thirty-sixth sec- 
tion lands would have aggregated three million, nine hundred, 
ninety-two thousand acres, but the state had "the advantage of 
selecting any unappropriated public land whether in the sixteenth 
or thirty-sixth sections or not.^"^* 

Although the unequal value of the school lands was a most 
powerful force leading the states to assume management of the 
Centralization of proceeds of the sale of lands, a general tendency 
Administration towards centralization of administration was both 
cause and effect of a desire growing in each state to give unity to 
the system of schools. The influence of the State Superintendent 
of Schools upon the educational system of the state could be 
greatly increased by vesting in him the apportionment of the 
revenue of the permanent state common school funds. The dis- 
cussion of this topic belongs more properly to Chapter VII in 
which will be considered the purpose and effects of the permanent 
common school fund. 

Despite the evils which have attended the state ownership and 
management of the public permanent common 

Advantage of State ° . . 

Over Local school f unds there are several considerations both 

theoretical and practical which justify the con- 
clusion that it was superior to either township or county manage- 

3011 Statement received from S. B. Nye, Cal. Controller, Dec. 15, 1906. 
soib Constitution of Nev., Art. XI, Sec. S; Report Nev. State Land Registrar, 
1905-06, p. 14. 



MANAGEMENT OF SCHOOL FUNDS 119 

merit. In the first place the greatest benefit would be gained if 
these funds were used not to aid individual communities but the 
schools of the state as a whole. This purpose was inevitably 
thwarted where, as was often the case, wealthy townships possessed 
funds greater than were needed to support their schools, while 
poor townships possessed small funds. Secondly, so long as the 
townships were looked upon as the owners of the school funds 
there was no higher authority to which they held themselves re- 
sponsible. It was much easier to hold the state responsible than 
the individual townships. The history of the management of 
these funds by the states shows a constantly growing effort to protect 
them and employ them to the best advantage. Thirdly, it was easier 
to make the laws for the state than for the townships, relative to 
the management and protection of these funds. Congress and 
the states united in this effort. 

The defects of state management, like those of the township 
management, will appear in the account of losses, and causes of 
Defects in State l^ss. One of the greatest, perhaps the funda- 
Management mental defect in state management, has been the 

failure on the part of the majority of the states to provide a single 
oflScer, whose sole duty should be to care for and invest the state 
permanent common school fund. Connecticut early realized the 
necessity and importance of this, and since 1810 her School Fund 
has been managed by a single officer known as the Commissioner 
of the School Fund.^°^ Unfortunately the states which were so 
ready to adopt Connecticut's policy of establishing a permanent 
fund for common schools failed to see the importance of her pro- 
vision for managing this fund. The result is that by far the major- 
ity of states have intrusted the care of millions of acres of school 
lands, and the investment of the proceeds of the sales of the same 
to officers or to a board composed of several officers, all over- 
burdened with other duties. 

Throughout the United States there is great variation as to the 
custodianship and management of the state-controlled funds. In 

303 Hinsdale, B. A. The Common School Fund 0/ Conneciicut, Report U. S. 
Commissioner of Education, 1892-93, p. 1260. 



I20 PERMANENT COMMON SCHOOL FUNDS 

some cases the care of the fund is in the hands of an officer appointed 
especially for this duty, in other cases it rests with a board made up 
of several state officers. 

In the following states the management of the permanent com- 
mon school fund is in the hands of a single officer, namely the State 
Different Forms of Treasurer : Maine,^^^ Delaware,^^^ Rhode Island,^^^ 
state Management g^^^j^ Carolina,^^^ Nevada.=*°« In Texas the 
county funds are managed by the counties, but the Permanent 
School Fund is managed by the controller.^°^ The New York 
Common School Fund and the Surplus Revenue Fund are man- 
aged by the controller.^^° The permanent common school fund is 
managed by a state board of commissioners in a large number of 
states, among which are Arkansas, Idaho, Kansas, Montana, 
Wyoming, Minnesota, Nebraska, Oregon, West Virginia, Wis- 
consin, and Utah. In Arkansas this Board of Commissioners is 
composed of the State Superintendent of Public Instruction, the 
Secretary of State, and the Auditor.^^^ In Kansas the Board of 
Commissioners which manages the State Permanent School Fund 
is composed of the same officers as in Arkansas, except that in the 
place of the Auditor, the Attorney-General is the third member of 
the board.^^^ In Wisconsin the permanent School Fund is managed 
by a board of commissioners composed of the Secretary of State, 
Treasurer, and Attorney-General.^^^ 

In Florida, North Carolina, and Virginia the fund is managed by 
the Board of Education.* The members of these boards of man- 
agers are generally selected from among the following officers: the 
Governor, the Attorney- General, the Secretary of State, the State 

* For these states cf. accounts in Part II. 

30* Revised Statutes (Me.), 1883, Chap. 11, Sees. 117-118. 

305 Del. School Law, 1898, p. 38. 

306 R. I. Laws, 1896, p. 14, Chap. 30, Sec. i. 

307 S. C. School Law, 1896, p. 9, Sec. 5. 

308 Nev. School Laws, 1897, XIX, Sec. 12, p. 35. 

309 Constitution, Art. 7, Sec. 4. 

310 N. Y. Laws of 1903, Chap. 350, note. 

311 Sandel & Hill, Digest, 1897, Chap. 139, Sec. 6941. 

312 Kan. Law, 1901, p. 117, Sec. 308; Gen. Statutes, 1889, Sec. 6650. 

313 Constitution, 1848, Art. X, Sec. 7. 



MANAGEMENT OF SCHOOL FUNDS 121 

Controller, the State Treasurer, the State Auditor, and the State 
Superintendent of Schools. 

It will be readily understood that ofl&cers upon whom devolve 
duties innumerable are unable to give the attention which is both 
Defects of State desirable and necessary to the investment and care 
Management q£ ^^iq permanent school fund. One result is 

that the immediate management and loaning of these funds in a 
number of states has been quite largely turned over to county 
officers. The losses which may arise from handing over the man- 
agement of a large fund to officers elected or appointed primarily 
for other duties, and the advantages arising from intrusting such 
a fund to the care of one officer appointed solely for this duty, will 
be seen by comparing the experience of New York with that of 
Connecticut. 

In New York the controller is the custodian of the United 
States Deposit Fund. It is managed as follows: two loan commis- 
sioners are appointed for each county by the gov- 

Poor Management '■ ^ j j o 

Illustrated by ernor and confirmed by the senate for a term of 

New York 1 • i 1 ., m- r 

two years. 1 he result is that the responsibility of 
management of this fund "is scattered through one hundred and 
twenty-two agencies, inadequately supervised by disconnected 
authority in the Supreme Court, controller and boards of super- 
visors, with no disciplinary power beyond reporting defaults of 
loan commissioners to the governor, to be transmitted to the Senate 
which may remove from office. The records do not show that a 
removal was ever made." ^^^ 

The loan commissioners in many cases are incompetent to pass 
upon abstracts of title and appraisals of property upon which the 
loans are made. In many cases they are indifferent to the dis- 
charge of their duties. The law requires that loans can be made 
only on property worth double the amount. Nevertheless, these 
laws have been continually ignored for nearly fifty years as shown 
by the two following passages, the first from the controller's report, 
1877, and the secorid from the controller's report, 1906: 

"Money is loaned upon property not worth double the amount of the 
31* Annual Report of the Controller of N. Y., 1906, pp. Iv S. 



122 PERMANENT COMMON SCHOOL FUNDS 

mortgage [as required by law]. Second and third mortgages are taken; searches 
are not made; minutes are not kept, . . . forged and fictitious mortgages 
have been taken, and during the past two years . . . commissioners . . . 
have absconded. . . . The state has to-day thousands of dollars invested 
in farms, the result of foreclosed loans that will not sell for a third of the prin- 
cipal and interest due." sis 

"A liberal estimate of the present worth of the $1,442,837.91 held by loan 
commissioners [of the United States Deposit Fund] of the entire state will not 
exceed $1,000,000 of sure assets." ^la 

The losses suffered by the principal of the United States De- 
posit Fund from April 4, 1837, to September 30, 1905, amount to 
$333,862.17 as follows: $199,035.44 lost on resale of lands; 
$56,045.75 lost on foreclosure sale of lands; $33,975.63 lost by 
failure of title; $44,804.38 lost by defalcation of loan commis- 
sioners.^" The average annual loss of the United States Deposit 
Fund has been nearly five thousand dollars ($4,909). 

In contrast to New York, Connecticut profited by the evil 
experience she met with as the result of intrusting her fund to a 
board of managers, and set about to make proper provisions for 
its care. From 1795 until 1800 Connecticut intrusted the manage- 
ment of the school fund to a committee of eight that had sold and 
transferred the lands. In 1800 a board of four persons, known as 
" Managers of the funds arising in the sales of the Western Reserve," 
was appointed. The report of the managers presented to the legis- 
lature October, 1809, showed that the condition of the fund was 
very unsatisfactory. "A large amount of interest was unpaid and 
the collateral securities of the original debts were not safe." Upon 
a recommendation of a committee of the legislature it was decided to 
put the fund in the care of one man, and in 1810, Honorable James 
H. Hillhouse, for sixteen years a United States Senator, was 
appointed "Commissioner of the School Fund." This of&ce has 
continued from that time until the present. Mr. Hillhouse inmiedi- 
ately resigned his position in the Senate and entered on the duties 
of his new office. "He found that the capital consisted chiefly of 

315 Controller's Report, 1877, p. 28. 
31" Controller's Report, 1906, p. Ixii. 
317 Ibid., p. 280. 



MANAGEMENT OF SCHOOL FUNDS 123 

the debts due from the original purchasers of the Western Reserve 
and the substituted securities which had been accepted in their 
stead. These securities had in the course of fifteen years, by 
death, insolvency, and otherwise become involved in complicated 
difficulties. The interest had fallen greatly in arrears, and in 
many cases nearly equaled the principal. The debtors were dis- 
persed in different states. Without a single litigated suit, or a 
dollar paid for counsel, he reduced disordered management to an 
efficient system, disentangled its affairs from loose and embarrassed 
connections with personal securities and indebted estates, rendered 
it productive of a large, regular, and increasing dividend, and 
converted its doubtful claims into well-secured and solid capi- 
tal. During the fifteen years of his administration the annual 
dividend averaged $52,061.35 and the capital was augmented to 

$1,719,434.24."'°^ 

To expect the State Superintendent of Schools, the State Treas- 
urer or Auditor, or some equally busy and sought-after person to 
care for a large fund is unworthy of an intelligent commonwealth. 
The State Superintendent of Wisconsin some years ago presented 
the matter strongly in his report as follows: ''The provisions for the 
sale of lands are inadequate and unbusiness like. By the consti- 
tution the Secretary of State, the State Treasurer, and the Attorney- 
General are made commissioners of public lands. Each of these 
officers is personally responsible for the administration of another 
great bureau of the state government. These commissioners are 
hampered ... by the want of authority to pay . . . competent 
agents to view and inspect these lands. By this short-sighted 
policy the state has lost millions to save thousands." 

"The building of a new railroad, the establishment of large mills . . - , 
the discovery of iron ore, an unexpected use for a kind of timber . . . may 
cause state lands ... to suddenly rise greatly in value. Private parties or 
corporations have agents in the field to learn these facts and buy the lands 
before the public officers learn of the change in the situation." ^^^ 

Sufficient reasons have not yet appeared why permanent common 

'18 Report Wis. Supt. of Public Instruction, 1891-92, pp. 141-142. 



124 PERMANENT COMMON SCHOOL FUNDS 

school funds, with proper management should not have increased 
through investment as well as through the sale of school lands. 

It is much to be regretted that the policy which Connecticut 
adopted in 1810 of appointing one man whose duties were confined 
to the management of the State School Fund was not adopted by 
all the other states of the Union. Had this been done, millions of 
dollars might have been saved to common schools. 

Many of the "credit funds" call for no special officer to care for 
them. It seems safe to say that every state mentioned in the first 
six groups in Table IV, Chapter I, ought to have a commissioner of 
the school fund whose duties would be to attend not merely to the 
secure investment of the fund but to the collection of unpaid inter- 
est and notes, and hasten the settling of disputed titles of school 
lands. Such an officer would undertake to see that necessary 
legislation was enacted to add to the school fund moneys now due it 
"but of which it is deprived owing to the incompleteness of the laws. 
It is impossible for officers whose chief interest lies in other direc- 
tions and who have only a limited staff, to manage these funds to 
the best advantage. A natural result is that these officers have in 
some states delegated the immediate investment and care of these 
funds to county officers, who in a large number of cases, do not 
have the cause or the common schools at heart and have little 
appreciation of the trust placed in their hands. 

The unfortunate experience of the states which early established 
permanent common school funds, related in the following chapter. 
Efforts Toward ^as not lost upon states which later came into 
Better Management ^^^ possession of school lands. A study of the land 
grants and of the state constitutions and laws reveals an increas- 
ing effort to protect the school lands and the funds derived there- 
from. The provisions in the earlier state constitutions were of a 
general character which left the most important matters respect- 
ing the management of the funds to the action of the legislature. 
But in the constitutions framed later the number and exactness of 
the provisions constantly increased. The earlier constitutions pro- 
vide merely for the establishment and preservation of a permanent 
fund whose income shall be devoted to the support of common 



MANAGEMENT OF SCHOOL FUNDS 125 

schools. The more recent constitutions make provisions regard- 
ing the sale price of school lands, the securities in which the pro- 
ceeds of the sales shall be invested, the management of the fund, 
the method of sale and of leasing school lands, and other important 
matters. The Enabling Acts of Ohio and of Alabama granted 
section number sixteen in every township or, where such section 
has been sold, lands in lieu of the same, to the inhabitants of such 
township for the use of schools. Their respective constitutional 
conventions and legislatures did not regard it within their scope 
to make any but general provisions. But the Michigan grant in 
1836, as previously stated, gave the lands to the state, and the con- 
stitution of Michigan, adopted January 26, 1837, provided that 
the proceeds of all lands granted by the United States should re- 
main a perpetual fund for the support of schools throughout the 
state. More than this, it provided that any school district neg- 
lecting to maintain a school for three months should be deprived 
of its portion of the interest of this fund. The importance of these 
provisions justifies quoting them here. 

Constitution of Michigan, 1837, Article X 

"Sec. 2. The legislature shall encourage, by all suitable means the promo- 
tion of intellectual, scientific and agricultural improvement. The proceeds of 
all lands that have been or hereafter may be granted by the United States to 
this state for the support of schools, which shall hereafter be sold or disposed 
of, shall be and remain a perpetual fund, the interest of which, together with 
the rents of all such unsold lands, shall be inviolably appropriated to the 
support of schools throughout the state. 

"Sec. 3. The legislature shall provide for a system of common schools, by 
which a school shall be kept up and supported in each school district at least 
three months in every year; and any school district neglecting to keep up and 
support such school may be deprived of its equal proportion of the interest 
of the public fund." 

The constitution of Michigan merely provided that the inter- 
est of the fund should be appropriated to the support of schools 
throughout the state. The constitution of Oregon, framed in 
1857, and which became effective upon the admission of that state 
into the Union in 1859, shows an increase in the number and exact- 



126 PERMANENT COMMON SCHOOL FUNDS 

ness of the provisions respecting school funds and their apphcation. 
It reads: "The interest . . . shall be exclusively applied to the 
support and maintenance of common schools in each district and 
the purchase of suitable hbraries and apparatus therefor." More- 
over, section 4 provides the method by which the revenue of the 
school fund is to be apportioned among the several counties. 
Section 5 provides for the constitution of a board of commissioners 
for the sale of the school and university lands.^^*' 

The constitution of Minnesota, 1858, framed a year later than 
that of Oregon, shows further progress in the tendency to guard 
the manner of disposition of the school lands. It provides that 
not more than one-third of the lands shall be sold in two years, 
one-third in five years, and one-third in ten years, and the lands 
of greatest value shall be sold first: "Provided: That no portion of 
the state lands shall be sold otherwise than at public sale." The 
constitutional provisions read as follows: 

"Sec. I. The stability of a republican form of government depending 
mainly upon the intelligence of the people, it shall be the duty of the legislature 
to estabhsh a general and uniform system of public schools. 

"Sec. 2. The proceeds of such lands as are or hereafter may be granted 
by the United States for the use of schools within each township in the state, 
shall remain a perpetual school fund to the state, and not more than one-third 
of said lands may be sold in two years, one-third in five years and one-third 
in ten years; but the lands of the greatest valuation shall be sold first, provided 
that no portion of said lands shall be sold otherwise than at pubUc sale. The 
principal of all funds arising from sales, or other disposition of lands, or other 
property, granted or intrusted to this state in each township for educational 
purposes, shall forever be preserved inviolate and undiminished; and the 
income arising from the lease or sale of said lands shall be distributed to the 
different townships throughout the state, in proportion to the number of 
scholars in each township between the ages of five and twenty-one years, and 
shall be faithfully applied to the specific objects of the original grants or ap- 
propriations.320 

"Sec. 3. The propositions contained in the act of Congress entitled 'an 
act to authorize the people of the territory of IN'Iinnesota to form a constitution 
and state government preparatory to their admission into the Union on an 

319 Constitution of Oregon, 1857, Art. VIII. 

320 Constitution of Minn., Art. VIII, Sees, i, 2, quoted from statutes of Minn., 
1849-58- 



MANAGEMENT OF SCHOOL FUNDS 127 

equal footing with the original states,' are hereby accepted, ratified and con- 
firmed, and shall remain irrevocable without the consent of the United States, 
and it is hereby ordained that the state shall never interfere with the primary 
disposal of the soil within the same, by the United States, or with any regula- 
tions Congress may find necessary, for securing the title to said soil to bona 
fide purchasers thereof; and no tax shall be imposed on lands belonging to 
the United States, and in no case shall nonresident proprietors be taxed higher 
than residents." 221 

The constitution of Kansas in 1859 provided in section 3 for 
the establishment of a perpetual school fund from the lands that 
had been or in the future might be granted to the state for the sup- 
port of schools, as well as from the proceeds of five hundred thou- 
sand acres of land granted under the act of 184 1. It further pro- 
vided that the principal of the fund should b^ increased from the 
estate of persons dying without heir or will, and from such per 
cent of the proceeds of the sales of public lands as may be granted 
by Congress. The object to which the revenue may be applied is 
stated in general terms, namely, the support of common schools. 
Section 4 provides for the annual distribution of the income of the 
State School Fund and for the basis of apportionment, namely, 
school population. It further makes the maintenance of a school 
at least three months annually, a condition which must be fulfilled 
in order to entitle the district to receive any portion of the revenue 
of the fund. Section 5 makes provision for the maimer of selling 
lands. All sales must be authorized by a vote of the people at a 
general election. School lands must be revalued every five years. 
The rate must be established by law.^^^ 

To guard against selling school lands for less than their real 
value a policy developed of providing in the state constitution a 
minimum sale price. One dollar and twenty-five cents per acre 
was the minimum price set by the older public land states. Michi- 
gan originally set eight dollars per acre as the minimum, but after- 
wards reduced it to five dollars. Nebraska, admitted in 1867, 
provided in her first constitution, five dollars per acre as the mim'- 
mum price of school lands. In 1875 ^^^ price was raised to seven 

321 Ibid., Art. II, Sec. 3. 

322 Constitution of Kansas, 1859, Art. 6, Sees. 2-5. 



128 PERMANENT COMMON SCHOOL FUNDS 

dollars. Washington, North and South Dakota, admitted in 1889, 
provided by their respective constitutions, ten dollars per acre as 
a minimum. 

Space does not permit carrying this topic further, nor can it be 
undertaken here to show the wise management which has controlled 
the funds in some states. SufSce it to say, that as a result of the 
increasing efforts to protect the funds, certain of the states which 
have come into the possession of common school lands appear to 
have managed them well and to have suffered no unavoidable 
loss. Reference to the table given at the close of Chapter I will 
reveal a number of states in which the entire fund is intact owing 
to the careful and wise administration it has enjoyed. 

The history of the loss and management of the public permanent 
common school funds offers many important suggestions to students 
of economics and education. The losses these funds have suffered 
and the decreasing importance of the funds as sources of school 
support, show how necessary it is that any fund set aside as a 
permanent endowment be surrounded by conditions and provi- 
sions which will, on the one hand, protect it, and, on the other hand, 
leave open the way for readjustment when conditions change, as 
they inevitably will. These funds have accomplished a truly 
marvelous work in the part they played in laying the foundations 
of bur systems of free public schools. To what extent this asser- 
tion is true will perhaps be made clear in another chapter which 
will undertake to show the educational results accomplished 
through the public permanent common school funds in the United 
States. 



CHAPTER VI 

LOSS OF THE PUBLIC PERMANENT COMMON SCHOOL FUNDS 

"This seems evident that a wise administration of all the provisions relat- 
ing to the school funds should have resulted in a permanent endowment of 

„,. . from fifteen to twenty million dollars: that we have instead 

Wisconsin • , * 

cash and money mvested $3,401,401.00 and a permanent 

debt of $2,251,000. The efifect is the creation of a perpetual state debt re- 
quiring the levy and collection of an annual state tax to the amount of $157,570 
to pay the interest thereon. The interest paid thus far amounts to $4,200,000 
and the process seems just begun. . . . Additional burdens of taxation are 
the only fruits of the school fund, the very result it was intended to avoid." 
Extracts from Report Wisconsin State Superintendent of Public Instruction, 
1892, pp. 152-154, 161. 

"A hberal estimate of the present worth of the $1,442,837.91 held by the 
„ „ , loan commissioners fin New York State of the United 

States Deposit Fund] will not exceed $1,000,000 of sure 
assets." Report, New York Controller, 1906, p. Ixii. 

"School land in Ohio has been taken at six dollars per acre, worth at the 
time fifty dollars." Extract from the first report, Ohio 
Superintendent of Schools. 

"There is no more melancholy chapter ... in American history than the 
record of the amazing waste of this great national gift to the people of Ohio. 
A. D. Mayo, The Development of Common Schools in the Western States, 
P- 363- 

". . . . In Iowa and Wisconsin . . . these splendid grants have be- 
come the prey of speculators. . . . The interests of the fund have been 

uniformly sacrificed to the interests of local combina- 
lowa 

tionSo" Extract from message of Governor Ramsey to 

Minnesota Legislature, 186 1. 

"To say that these funds have been grossly and shamefully diverted from 

their original purpose is putting the case in a mild form. Many of the county 

„. . courts . . . have entered into combinations with corpo- 

Missouri . ,.,..,, , ^ , 

rations and mdividuals to so manage these moneys and 

lands that they have fallen into the hands of private parties." Missouri 

Pubhc School Report, 1870, p. xi. 

129 



I30 PERMANENT COMMON SCHOOL FUNDS 

"The defaulted interest up to 1900 amounts to $700,000." Report, Super- 
intendent of Public Instruction of Texas, 1899-1900, p. xlvii. "2,618,286.10 

acres of public lands were sold at fifty cents an acre." 
Texas 

Report of Texas Commissioner of the General Land 

Office, 1899, p. 21. 

The account given in this chapter of the losses suffered by the 

pubhc permanent common school funds is in no sense complete. 

The most that can be done in a discussion which 

Loss of Funds 

Difficult to attempts to cover as broad an area as this is 

to present instances of typical losses. In many 
states a complete set of educational or of financial reports appear 
not to exist. Furthermore it is only now and then that a state 
report reveals the condition of the permanent common school fund. 
Whole decades pass with almost no mention of these funds. Ques- 
tions sent to state departments of finance and of education have 
been in some cases not answered, and in other cases answered 
incorrectly. Thus the answers received from Iowa would lead 
one to suppose that the only losses which the permanent school 
fund had suffered amounted to ten thousand, nine hundred thirty- 
seven dollars eighteen cents ($10,937.18). The following ques- 
tion was asked: "Estimate as nearly as you can the total loss 
sustained by the permanent school fund from the time of its estab- 
lishment to the present." The answer given reads: "The above 
$10,937.18 represents the loss to the fund prior to January i, 
1874.^^^ The report of the State Superintendent of Public Instruc- 
tion 1868 states that at that time the auditor estimated that there 
had been lost to the fund over one hundred twenty-five thousand 
dollars ($12 5,000) .^24 

Further, it is impossible to estimate the amounts which the 
funds in the different states are being annually deprived of, owing 
to failure to properly collect interest due on notes, fines and other 
moneys set apart by law for the increase of the principal of the 
permanent common school fund. Here and there a state superin- 
tendent gives some estimate of the losses in his particular state, 

323 Answers returned to F. H. Swift, Nov. 15, 1906, from Iowa State Auditor. 

324 U. S. Bureau of Education, Circular of Information, 1888, No. 7, p. 15. 



LOSS OF SCHOOL FUNDS 131 

but only by a most careful investigation conducted by each state 
would it be possible to secure anything like a complete account 
of the total losses in the United States. 

Loss Under Town- The loss due to the mismanagement of perma- 
of Fun^rRecords ^^^^ funds by townships was not confined to any 
and Proceeds Lost particular State or section. 

Connecticut in 1837 deposited her portion of the United States 

Surplus Revenue Loan with the towns to be loaned by them. 

Soon after the loan had been made, the principal 

Connecticut ^ ^ 

began to be absorbed and diverted by the towns, 
so that at the present time we are told that in most cases the fund 
exists only on paper .^^^" 
Three hundred and fifty-five towns in Maine should have pos- 
sessed town funds as a result of Massachusetts 

Maine 

legislation, 1788, and of subsequent legislation. 

In 1898 seventy-three towns had misappropriated their funds.^^"** 

In California, the towns sold some fifty thousand acres of lands 

prior to the consolidation of the sixteenth and thirty-sixth section 

„ ., . lands with the State School Fund. The proceeds 

California ^ 

of the sales of these lands, estimated at two dol- 
lars per acre, should have added one hundred thousand dollars 
($100,000) to the State School Fund, but the money has never been 
heard oij'^' 

In Louisiana and Mississippi the story is much the same: the 
Louisiana, townships sold large areas of school lands, but" 

Mississippi ^Yie proceeds of the sales have entirely disappeared. 

Frequently the indifference or lack of business methods of those 
charged v/ith the sale of the school lands has resulted in no record 
Sales Not being made of the sales, or in a careless record, 

ecorded jj^ Louisiana some townships intrusted the pro- 

ceeds of their school lands to the state, some still possess their 
lands, others have lost all record of them.^'^'* In Mississippi 

3241 Report Conn. Board of Education, 1903, p. 43. 

32^-6 Me. School Report, 189S, p. 52. 

32^c Report Cal. State Supt. of Public Instruction, 1S64-65, p. 249. 

32«i U. S. Bureau of Education, Circular of Information, 1898, No. i, p. 104. 



132 PERMANENT COMMON SCHOOL FUNDS 

school lands have been sold and the record of sales lost. In 1895 
the titles of some school lands were still in process of litigation.^^^ 

The Superintendent of Schools of Alabama, in his report for 
1891 wrote: "The loss has frequently been due to the failure of 
properly recording the sale and title of the school lands. Much 
of the time of this department is consumed in investigating . . . 
records relating to the sixteenth section lands. Little evidence 
has been found regarding the sale of school lands. It is impossible 
to tell in many cases what subdivisions were sold, becavise trustees 
reported by lots instead of subdivisions of sections, and frequently 
no date of purchase is recorded. Parties who claim to have pur- 
chased these lands before the war from the state or from those 
who originally purchased the same are continually applying for 
patents, and in order to issue the same, secondary evidence has 
to be relied upon.^^^ 

In a large number of states the manner in which the school lands 
were sold resulted in great loss to the funds. The bad policies 
Losses Due to Bad employed vary all the way from methods which 
Method of Sale were unbusincss like, short-sighted and inefficient 
to those which were clearly dishonest and fraudulent. This topic 
will be discussed more fully in connection with management under 
state control: here one example, that of Ohio, will suffice to suggest 
what happened in many states. The first report of the State 
^Superintendent of Schools in Ohio contains the following state- 
ment: "School land has been taken at six dollars per acre worth 
at the time fifty dollars. School lands have been sold at less than 
one dollar and in some cases at less than fifty cents.^^' 

Intrusting the management of the funds to local officers in 
some cases indifferent, in many cases incompetent, has resulted in 
Loss Due to another evil : namely, the investment of the princi- 

Bad Investment ^^^ jj^ pQ^j. securities. Attention has been called 
in the previous chapter to the account by F. P. Alcott, Con- 
troller of New York state, in his report, 1877, wherein he wrote 

325 Report Miss. State Supt. of Education, 1894-95, p. 31. 

326 Report of School Supt., Alabama, 1S91, p. 7. 

327 Quotation taken from S. P. Orth, Centralization of Administration in Ohio. 



LOSS OF SCHOOL FUNDS 



133 



respecting the loaning of the United States Surplus Revenue Fund 
by county commissioners: "Searches are not made, minutes are 
not kept, . . . Forged and fictitious mortgages have been taken.^^^ 

The state of Missouri presents a striking illustration of loss 
Miscellaneous under local management and of the complex and 

Causes— Missouri ^lany reasons causing such losses. 

The report of the Superintendent of Public Schools of Missouri 
for the year 1870, Chapters XII and XIII, attempts to give an ac- 
count of the Township School Fund lost. As previously stated, the 
counties managed this fund for the towns. The report shows that 
over one hundred seventeen thousand dollars of the Township School 
Fund alone was reported as having been lost prior to 1870, but owing 
to the fact that in cases of many townships the amount lost could 
not be ascertained the total loss exceeded the sum named in the re- 
port. Among the various causes of loss named are the following: 
burning of the court-house, parties running away, parties insolvent, 
default of county treasurer, notes outlawed, stolen, carelessness, 
the war, insufficient security, parties absconding, robbery, records 
imperfectly kept, townships having no fund being too disloyal to 
organize, records burned, carelessness of officials, worthless notes. 

The reasons given for losses by the different counties number 
over twenty. Some counties give more than one reason for loss, 
so that in the following table the sum of the counties does not 
equal the sum of the reasons. 



Table XVIII. Loss of Township School Funds in Missouri Prior to 1870 

(Taken from pp. XII-XIV, Report of Missouri Superintendent of Public 
Schools, 1870) 



Counties 


Present 
Amt. of 
Town Fund 
in Each 
County 


Amount of 
Fund Lost 
in Each 
County 


How Lost 


Remarks 


Adair 
Andrew 

Audrain 
Barry 


Si2,S73 
49,908 

24,738 
4,092 


Unknown 

$1,000 

945 
1,991 


Court-house burned 
Parties ran away 

Parties insolvent 
Default of county 
treasurer 


$200 used 1868 to pay 
county treasurer 



134 PERMANENT COMMON SCHOOL FUNDS 

Table XVIII — continued 



Counties 


Present 
Amt. of 
Town Fund 
in Each 
County 


Amount of 
Fund Lost 
in Each 
County 


How Lost 


Remarks 


Barton 


$4,468 








Bates 


35,071 


$554 


Parties insolvent 




Benton 


13,977 


Much lost 


Supposed to have 
been paid to Gov. 
Jackson, 1861 


All records of school 
money lost during late 
(Civil) War 


Bollinger 


5,788 


363 


Parties insolvent 


Suits pending to re- 
cover money loaned 
before the war 


Boone 


33,721 








Butler 


5,013 


Much lost 


Parties insolvent 


Money loaned before 
the war — interest not 
paid— no suit brought 
to recover money 


Caldwell 


18,808 








Callaway 


37,969 








Camden 


7,179 


64 


Note outlawed 


Interest not punctually 
paid. 


Carroll 


38,013 


1,241 


Insolvency 


Money of several town- 
ships cannot be col- 
lected 


Carter 


300 








Cass 


41,742 


972 


Worthless notes 




Cedar 


6,401 


5,551 


The war 




Christian 


5,518 








Clark 


23,409 








Clinton 


26,414 








Cole 


29,392 


457 


Carelessness 




Cooper 


26,108 


3,268 


Insolvency and theft 




Crawford 


9,215 








Dade 


10,819 


5,813 


Court-house burned 


Records burned; suits 
brought to recover, 
parties plead payment 


Dent 


7,762 








Dunklin 




Records do 
not show 
a m u n t of 
fund 




County Court can tell 
nothing about school 
fund 


Gasanade 


16,783 




No acc't kept of loss 




Girardeau 


20,577 








Green 


13,367 






Very imperfect account 
kept 



LOSS OF SCHOOL FUNDS 
Table XVIII — continued 



135 



Counties 


Present 
Amt. of 
Town Fund 
in Each 
County 


Amount of 

Fund Lost 

in Each 

County 


How Lost 


Remarks 


Grundy 


$17,075 


Much lost 


Insufficient security 


Much lost by letting 
to individuals without 
good securities 


Hickory 


7,092 


$700 


Parties absconding 


School fund used to 
pay county clerk and 
county treasurer 


Holt 


12,978 


315 


Insufficient security 




Howard 


17,207 


14,812 


Robbery 


Stolen from bank Oct., 
1864 


Jasper 


20,652 


11,909 


Insufficient security 




Jefferson 


31,001 


302 


Poor note 


Money from fines, pen- 
alties, etc., apportioned 
annually 


Johnson 


30,432 


Not reported 


Insufficient security 




Lafayette 


32,490 








Lawrence 


18,051 


Not reported 


Records imperfect 


County attorney in- 
vestigating old cases. 


Lewis 


20,542 






Money loaned, notes 
taken and allowed to 
be lost by statute of 
limitation 


Lincoln 


26,294 








Linn 


18,581 


Not reported 


Insufficient security 


Bad notes approved by 
County Court 


Livingston 


25,304 


4,100 


Insolvent borrowers 




Maries 




Records lost 


Treasurer absconded 


Suit pending to recover 
amount of school 
money 


Madison 


5,683 


Not able to 
say 






Marion 


37,257 








Mercer 


10,914 








Mississippi 




31,146 


Notes outlawing 


Nearly all school 
money has been mis- 
applied for last sixteen 
years. 


McDonald 


2,283 


Two town- 
ships have no 
fund, being 
too disloyal 
to organize 




None of money in 
county invested 



136 PERMANENT COMMON SCHOOL FUNDS 

Table XVIII — continued 



Counties 


Present 
Amt. of 
Town Fund 
in Each 
County 


Amount of 

Fund Lost 

in Each 

County 


How Lost 


Remarks 


Moniteau 


$21,074 


$150 


Bad note 


Some notes given be- 
fore the war. 


Monroe 


31,585 


1,500 


Insufficient securities 




Montgomery 


17,314 


Not reported 


Records burned 


Loss unknown, records 
burned during war 


Newton 


11,440 


6,946 


Insufficient security 


$4,884 in old ante 
bellum notes 


Oregon 


2,701 


Not reported 


War 


Misapplied by County 
Court 


Osage 


10,748 


1,604 


Insufficient securities 


Insolvency and ab- 
sconding 


Pemiscot 


6,166 








Perry 


16,579 






Old notes on file in 
office show some loss. 


Pettis 


29,364 






Some lost by parties 
becoming insolvent,but 
a greater part was used 
by parties for private 

USG 


Pike 


45,267 


Not reported 


Insufficient security 


Many old notes, cannot 
tell how much is good 


Platte 


19,394 


Heavy loss 


Insufficient security 




Polk 


10,815 


Cannot tell 


Notes lost or de- 
stroyed during war 




Pulaski 


1,513 


Not reported 


Insufficient security 


A large amount stand- 
ing out on old notes. 
County Court trying to 
collect 


Ralls 


26,448 






All school money jeal- 
ously guarded 


Randolph 


22,152 


154 


Insufficient security 




Ray 


33,261 






Fines and penalties dis- 
tributed annually 


Saline 


85,350 






$14,000 in litigation 


Schuyler 


7,591 








Scotland 


10,742 


1,592 


Insufficient security 




Scott 


7,426 








St. Charles 


77,144 


Not known 


Officers careless 


$8,000 in litigation 


St. Clair 


16,673 


16,673 


By war 


Lost $63,971 during 
war. County Court is 
trying to recover 



LOSS OF SCHOOL FUNDS 
Table XVIII — continued 



137 



Counties 


Present 
Amt. of 
Town Fund 
in Each 
County 


Amount of 

Fund Lost 

in Each 

County 


How Lost 


Remarks 


St. Francois 


$20,8Sl 


$477 






Shannon 


1,600 


800 


Insufficient security 


Money not invested 


Shelby 


22,537 


350 


Insufficient security 


Mortgaged property 
sold for less than 


Stone 


7,800 






debt 


Taney 


723 








Texas 


5,779 


Not reported 




$2,000 in litigation. 
Execution issued 


Warren 


15,090 








Washington 


30,879 


162 


Not reported 


Some money loaned to 
county 


Wayne 






All funds lost during 
war. 




Worth 


4,367 


2,711 


Insufficient security 




Wright 


2,018 


Not reported 


Treasurer absconded 


Treasurer gave no 
bond 



Summary -; 



Total number of counties 81 

Counties reporting a definite loss 31 

Counties reporting a loss but unable to state amount 18 

Counties in which loss has occurred 49 



Reason Given for Loss * No. of Counties 

Giving This Reason 

1. Security insufficient 15 

2. Parties insolvent 9 

3- War 5 

4. Poor notes 4 

5. Notes outlawed 3 

6. Parties absconding 3 

7. County treasurer defaulted or absconded 3 

8. Imperfect accounts kept 3 

9. Moneys belonging to capital of fund apportioned annually , . 2 

10. Used to pay county officers 2 

11. Carelessness 2 

12. Records burned 2 

13. Theft 2 

*This tabulation is based on data included in column " How Lost "; does not 
include data under " Remarks." 



138 PERMANENT COMMON SCHOOL FUNDS 

Table XVIII — continued 

Reason Given for Loss * No. of Counties 

Giving This Reason 

14. County court-house burned i 

15. All records lost during Civil War i 

16. County failed to collect notes i 

17. Records incomplete 1 

18. Notes lost or destroyed i 

19. Misapplied i 

20. Used by individuals for private purposes I 

Total number of reasons, 20. 

Given by 58 counties. 

Reasons 11 and 16 are almost identical. 

Reasons 10 and 19 are almost identical. 

It soon became evident that state control would not in itself 
insure the permanent school funds against loss. The causes of 
Losses Under loss under townsliip control arose in many cases 

state Management ^j^^^j. g^^^g^ 'pj^g g^jg q£ j^j^^g ^^^^^ ^^j^g^ 

misappropriation of proceeds, dishonest management and bad 
investment characterized the earliest attempts at state manage- 
ment. 

Kansas received from twenty to forty per cent less for her school 
Lands Sold lands than their real value. The Superintendent 

Below Value q£ Public Instruction in a report wrote: 

"These common school lands and those of the Atchison, Topeka and 
Santa Fe Railroad were selected in the same manner, our interest is lov^^er 
and our time longer than this company's. Our school lands should sell for a 
higher price, but they sell for less." 

In 1878 the average price of the school lands was three dollars 
and seventy-three cents per acre, that of the Atchison, Topeka 
and Santa Fe railroad lands, four dollars, fifty-two cents. The 
following year the average price of the school lands was three 
dollars fifty-seven cents, whereas the average price of the railroad 
lands was four dollars, seventy-two cents. It has already been 

* This tabulation is based on data included in column " How Lost "; does not 
include data under " Remarks." 



LOSS OF SCHOOL FUNDS 139 

stated that in Ohio school lands worth at the time fifty dollars an 
acre had been sold at six dollars. ^^^ 

Governor Ramsey, in his message to the Minnesota legislature 
Governor Ramsey's in 1 86 1, made a most excellent comparison of the 
PoiTdes'and ° ^ ^ Sale poHcics of Wisconsin, Iowa, Michigan, and 
Mmimum Prices Minnesota. His message was in part as follows : 

The minimum price of school lands in Iowa and Wisconsin was fixed by 
law at $1.25 per acre, "under which (system) their splendid grants have 
become the prey of speculators . . . under the appraisal method of those 
states, the interests of the fund have been uniformly sacrificed to the in- 
terests of local combinations. While . . . they have managed to get rid of 
a large amount of lands in a short . . . time — which . . . seemed to be 
the main object — they have realized only a small proportion of their true 
value to the state. The minimum of $1.25 which the legislatures of those 
states adopted shows at how low a rate they prized the national boon. 

"The results of their short-sighted policy ought to be sufi&cient warning 
against the errors of their example. Considerably more than half of the 
school lands have been sold in these states within the last ten years, and the 
fund realized in each case has been less than two million dollars. It would 
be mere repetition to say that, under a proper system, nearly the same re- 
sults might have been obtained from a third of the lands sold. In Michigan, 
where a minimum of $8.00 originally obtained — afterward reduced to 
$5.00 — out of only a million acres of school lands, one-third have been sold 
in twenty years, with a resulting fund of 11,613,434. It is worthy of re- 
mark, that over $400,000 of this was produced by the sales of the first five 
years, at an average of f 7.00 per acre." '^^ 

"The first sales of (Minnesota) school lands occurred in the autumn of 
1862 at a most unpropitious period, many able-bodied citizens having 
volunteered as soldiers . . . and hundreds having abandoned their farms 
in the frontier counties to escape . . . the savage Sioux, while those who 
expected to settle in the state halted in regions supposed to be more secure. 
The result of the sales in the face of all these discouragements surprised the 
most sanguine. . . . More than thirty-eight thousand acres were dis- 
posed of at a little more than six and one-third dollars per acre, as will be 
seen by examining the following statement:" Total sales from 1862-1866; 
number of acres, 210,722.67; price realized, $1,324,779.03; average per 
acre, $6.2S4.328« 

'-8 Extract from Governor Ramsey's message to the Legislature of Minnesota, 
i86t. Report of U. S. Commissioner of Education, 1867-68, p. 73. 
^^^« Report, U. S. Commissioner of Education, 1S67-68, p. 74. 



I40 PERMANENT COMMON SCHOOL FUNDS 

The terms on which school lands were purchased in many states 
were so easy that often the lands were bought, used, and then left 
Loss from Lax ^^ ^ Comparatively worthless condition to revert 
Terms of Sale ^^ ^|^g state. Many instances can be found where 

large tracts of timber land were purchased at not more than two 
dollars and a half an acre. The buyer paid forty per cent of the 
purchase price with a specified rate of interest on the amount 
remaining unpaid. The result was that as soon as the timber was 
taken off the land, the company or purchaser discontinued pay- 
ment and the land returned to the state. The following letter, 
received from a competent and reliable authority, might have been 
written from any of several states in the Middle Northwest: 

"Professor Fletcher Harper Swift, 

"Dear Sir: It is perhaps hardly necessary to say that the large area of 
pine lands in the northern part of the state appealed to a comparatively small 
body of men. There were a few lumber pioneers, men, as a rule of limited 
education, but of great energy, much foresight and large financial ability, 
who saw the possibilities for fortunes in the pine forests. They also recognized 
that the communities between the north and the south part of the state would, 
for many years, be quite limited and that the large open prairies in the southern 
parts would naturally attract and hold the great body of settlers. They were 
entirely correct in their conclusion and the southern part of the state for 
decades remained absolutely ignorant of what was in the northern part. The 
children were. informed in the schools and the parents through the newspapers 
then in existence, that the pine forests of the state were simply inexhaustible, 
and while those living along the great rivers could not fail to have their atten- 
tion called to the numerous quantities of lumber coming down during the 
open season, they thought little about it. When the legislature met, the energy 
and shrewdness of those who knew the situation covering the greater part of 
the state were easily able to secure the election to the legislature of such per- 
sons as were more or less allied to their interests. These men were also men 
of shrewdness and ability and apparently well understood why they were 
selected to represent the northern part of the state in the legislature. While 
they were very few in number, they with the forces back of them, exerted 
large influence and were able to secure the passage of laws relating to the sale 
of public lands that were favorable to the lumber interests. One citizen of 
the middle western part of the state who was at that time wealthy, and who 
afterwards was for several years a janitor told me that he purchased a saw 
mill and in forty days made $10,000 net. He stated, however, that this was 
the most money that he had ever made in a limited time. One man tramped 



LOSS OF SCHOOL FUNDS 141 

on snow shoes from Canada, who was barely able to read and write and keep 
simple accounts. His tremendous energy, however, put him in command of 
lumber interests so that it was not a great while until his fortune was estimated 
to be three millions of dollars. 

Very truly yours,* 

That decrease in value of school lands due to their being 
stripped of timber was general needs not to be declared to any- 
one familiar with the history of the treatment of forest lands in the 
United States. Governor C. M. Zulick, in 1887, stated that lands 
set aside by Congress in Arizona were uncared for, misused by 
settlers and denuded of timber by lumbermen and that when help 
was needed the lands were in a condition which made it impossible 
to rent them or sell them.^^^ Again the Superintendent of Public 
Instruction of Wisconsin in 1892 wrote: "It is notorious that state 
lands covered with valuable timber have been sold, a fraction of 
the purchase price paid, the timber removed, and the land then 
allowed to lapse to the state." "^° 

Another cause which has resulted in lands once sold being 
returned to the state unpaid for, is that the taxation levied upon 
Exorbitant them has been unjustly severe. That this cause 

Taxation q£ j^gg ^^^ ^^^ Confined to one state is evident 

from complaints in educational reports- of Missouri, Wisconsin, 
and other states. In 1859 Superintendent of Public Instruction 
in Wisconsin, Lyman C. Draper, complained that exorbitant taxa- 
tion was leading many who had purchased school lands on mort- 
gages to forfeit the lands to the state, thus throwing them back 
upon the state and depriving the state of interest. He cites a case 
in which it is stated sixty-eight dollars and forty-eight cents was 
charged for one year as interest on the non-payment of one hundred 
forty-eight dollars, sixty-five cents.^^^ 

Unfortunately, moneys derived from the proceeds of the sale of 
school lands were frequently invested in unsafe securities. Among 

* The writer of this letter was unwilling to have it published over his signature. 
320 Report U. S. Commissioner of Education, 18S6-87, p. 112. 

330 Report Wis. Supt. of Public Instruction, 1891-92, p. 142. 

331 Report Wis. Supt. of Public Instruction, 1S59, PP- ic>-i2. 



142 PERMANENT COMMON SCHOOL FUNDS 

the commonest causes of loss have been bad loans, unpaid notes, 
and unpaid interest on bonds and notes. The loans made from 
Losses from the Connecticut School Fund previous to 1810 re- 

Bad Loans g^j^g^ ^^ gj.g^^ j^gg^ ^j^gj^ ^^^ ]ame5 H. Hill- 

house accepted the position of Commissioner of the School Fund, he 
found that the principal of the fund consisted chiefly of debts due 
from the original purchasers of the Western Reserve, and the 
substituted securities which had been accepted in their stead. In 
many cases interest had fallen greatly in arrears and nearly equaled 
the principal. The excellent manner in which Mr. Hillhouse 
brought about order and the way in which he saved the fund is 
recounted in Part II. As stated above, the Controller of New 
York, in 1905, estimated that the total losses suffered by the prin- 
cipal of the United States Deposit Fund from April 4, 1837, to 
September 30, 1905, amounted to $333,862.17.^''^ Prior to 1843, 
$27,918 of the Congressional Township Fund of Indiana was lost 
through unpaid mortgages.^^^ 

The first losses suffered by the school fund of Arkansas were 
caused by loaning the proceeds of the sales of the sixteenth section 
lands on insufficient security. In Arkansas as early as 1870 the 
claims of the state in the form of practically worthless notes and 
bonds for school lands amounted to three-fourths of a milhon of 
dollars.^^^ 

The Permanent School Fund of Iowa prior to 1868 had suffered 
losses amounting to over one hundred twenty-five thousand dol- 
lars ($125,000).^^ No estimate more recent than 1868 of losses 
suffered by this fund has been available. One of the chief causes 
of this loss was loaning the fund on insufficient securities.^^^ The 
state has issued six per cent bonds to the extent of ten thousand, 
nine hundred thirty-seven dollars, eighteen cents ($10,937.18) to 
cover loss arising prior to January i, 1874.^^^ 

The State Superintendent of Public Instruction of Nebraska 

332 Cotton, F. A., Education in Indiana, p. 176. 

333 Report U. S. Commissioner of Education, 187 1, p. 73; Ibid., 1901, I, p. 393. 

334 Report la. Supt. of Public Instruction, 1868, p. 18. 

335 Statement received Nov. 15, 1906, from State Auditor of Iowa. 



LOSS OF SCHOOL FUNDS 



143 



states that the first investments of the proceeds of the sales of 
public lands were made at a loss of one thousand, five hundred 
forty-seven dollars and four cents ($1,547.04), and the investments 
made in the year 1868 resulted in an aggregate loss of three 
thousand, four hundred thirty-nine dollars, sixty-seven cents 

($3,439-67) •''' 

Alabama, Mississippi, and Missouri are among the states which 

report losses through unpaid notes. Many notes given in Alabama 

for school lands from 1837-74, inclusive, remain 

Losses Through , ^# #-r7 , 

Unpaid Notes unpaid. In some cases the title of sixteenth sec- 

and Interest • i i 

tion lands were surrendered to townships but the 
lands continued, though unpaid for, to be occupied and cultivated 
for years.^^^ In Mississippi, in 1833, an act introduced the system 
of leasing lands belonging to the Literary Fund for a term of 
ninety-nine years. The rents frequently went unpaid and the 
fund dwindled away through the decrease in value of the notes 
given.* The losses sustained by the Missouri fund have already 
been treated at length in this chapter. 

It is impossible to form even a rough estimate of how much of 
the State Permanent School Fund of Kansas has been lost. The 
earlier reports all indicate that large sums belonging to the fund 
have been lost. In 1878 the Superintendent of Public Instruction 
wrote that the state had sustained great losses in the sale and 
management of school lands, and added, " these losses are rapidly 
increasing, and if they continue, will amount to millions of dol- 
lars." ^^^ In 1894 a long list of bonds was reported on which inter- 
est had been due for several years or longer, including one hundred 
thousand dollars worth of bonds " upon which interest has not been 
paid for a long time." ^^^ The Permanent School Fund of Texas 
in the year 1 899-1 900 had a nominal income of one million, one 
hundred fifty-seven thousand dollars ($1,157,000), the real income 
amounted to eight hundred, eighty-five thousand dollars ($885,000). 

* Cf. account given in Part II. 

338 Report Neb. State Supt. of Public Instruction, 1869-70, pp. 70-73. 

337 Report Ala. State Supt. of Education, 1879, p. 9. 

338 Report Kansas State Supt. of Public Instruction, 1878, p. 36. 
338 Ibid., 1893-94, pp. 50 ff. 



144 PERMANENT COMMON SCHOOL FUNDS 

The loss was due to the fact that about two hundred seventy-five 
thousand dollars ($275,000) per year of interest on land noted was 
not paid. The defaulted interest up to 1900 amounted to at least 
seven hundred thousand dollars ($700,000).^^° 

The permanent common school funds in a number of states have 
suffered severe losses from the failure of banks in which moneys 
„ , ^ ., beloncring to the funds were invested. As might 

Bank Failures & t> o 

be expected this was a more common occurrence 
in the early days of our country before the banking system had 
been placed on a firm basis. Alabama appears to have lost 
through the failure of the state bank all of her share of the United 
States Surplus Revenue Loan which she had set aside for common 
schools.^"*^ Mississippi invested the proceeds of her Literary Fund 
in stock of the Planter's Bank. This bank also failed and the 
money belonging to the Literary Fund was lost. In 1838, by an 
Act passed January 19, Tennessee established a state bank with 
nine branches. The bank was capitalized at $5,000,000. In 
this five million were included among other moneys, the Common 
School Fund and Tennessee's share of the United States Surplus 
Revenue Loan of 1837, the latter amounting to $1,353,209.^^ The 
bank almost at once entered upon a career of wreckage, in which, 
of course, the two funds named above were involved. The failure 
of the bank finally came during the Civil War and in the failure 
the Common School Fund and the Surplus Revenue Fund were 
lost.^'^^ Failure of banks in North Carolina during the Civil War 
and reconstruction period resulted in a loss to the Literary Fund 
of about one million dollars ($1,000,000). The only reported 
loss incurred by the Common School Permanent Fund of Wyoming 
occurred in 1893 through the failure of a bank. The Common 
School Permanent Fund's share of the loss was five thousand, 
seven hundred sixty-eight dollars, thirty-five cents ($5,768.35).^'^^ 

3*0 Report Texas Supt. of Public Instruction, 1899-1900, p. XLVII. 
341 Bourne, E. G., History of the Surplus Revenue Fimd of ISjy, p. 122. 
312 Ibid., pp. 110-115. 

3*3. Statement to F. H. Swift, Dec. 12, 1906, from Robert P. Fuller, Wyo. Com- 
missioner of Public Lands. 



LOSS OF SCHOOL FUNDS 145 

In the years from 1874 to 1879 something over one hundred 
seventy-nine thousand dollars belonging to the Permanent School 
Fund of Arkansas was destroyed by fire.^^'* The 
report of the Superintendent of Public Instruction 
of Missouri in 1870, previously referred to in this chapter, names 
two counties in which the records of the township fund had been 
burned, and two in which the court-house had been burned, in 
each instance the permanent school fund suffered loss. 

Mismanagement, dishonest management, theft, embezzlement, 

absconding of debtors and of ofl&cers intrusted with the principal, 

constitute some of the wrongs committed against 

Loss Through ° ° 

Dishonesty and the permanent common school funds in many of 

Embezzlement 

the states. 

Robert McEwen, State Superintendent of Schools, 1836-40, 
succeeded in robbing the Common School Fund of Tennessee of 
thousands of dollars. A committee of seven was appointed by the 
legislature in 1839 to examine his accounts. The real condition 
was revealed by an investigation by a committee of five subse- 
quently appointed. This committee reported that Superintendent 
McEwen " was a general operator in a variety of ' wild cat' schemes, 
such as banks insolvent from the beginning; loans to partners in 
mercantile houses; land companies in Texas and Alabama, with a 
constant reputation for 'note shaving.' "^^^ During his four years 
of office Superintendent McEwen had borrowed from the Common 
School Fund $121,169. 

Prior to 1880 Indiana had been granted one million, two hundred 
fifty-seven thousand, five hundred eighty-eight (1,257,588 acres) 
of swamp lands. The constitution, 1851, article 8, section 2, 
provided that the proceeds of the sales of swamp lands, after 
deducting the expense of selecting and draining them, should 
constitute a part of the Common School Fund. In 1866 the Super- 
intendent of Public Instruction wrote: "These lands have nearly 

S'** Report Ark. State Supt. of Public Instruction, 1883-84, p. 39. 

^5 Mayo, A. D., Organizatioji and Development of the American Common School 
in the Atlantic and Central States of the South, 1830-60; Report of the U. S. Com- 
missioner of Education, 1899-1900, pp. 552, 553. 



146 PERMANENT COMMON SCHOOL FUNDS 

all been sold yet nothing from this source has been added to the 
fund. Much might have been added if the swamp commissioners 
had been honest." ^'*^ In 1890 it was estimated that $850,000 was 
due the Common School Fund of Indiana from the proceeds of 
the sale of swamp lands.^^' 

In the year 1897 the Permanent Common School Fund of Ne- 
braska lost two hundred fifty-nine thousand, eight hundred forty- 
two dollars, eighty-seven cents ($259,842.87) through embezzle- 
ment.^^* 

The principal of the permanent common school fund in many 

states has failed to receive certain moneys due it. Some states 

have enacted laws which proved incomplete; 

Moneys Diverted ^ 

from the Others have failed to add to the principal of the 

fund moneys due it; still others have diverted to 

some other object moneys due the principal. 

Arkansas provided that the principal of the Permanent School 

Fund should be increased by ten per cent of the net proceeds of 
the sales of all state lands, but the act failed to 

Losses Through 

Incomplete State whether the Land Commissioner or State 

Treasurer should have charge of this matter. It is 
estimated that through the incompleteness of this statute the Com- 
mon School Fund, from 1875 to 1895, was deprived of fifty thou- 
sand dollars ($50,000) .^^^ 

The constitution of Indiana, 1851, which provided for the crea- 
tion of the Permanent Common School Fund, set aside eight sources 
for increasing the principal. As far as the records show, only 
three of these, fines, forfeitures, and estrays, have ever added any- 
thing to the principal. Reference has already been made to the 
moneys from the sales of swamp lands of which this fund has been 
deprived. An act was passed by the legislature of Indiana in 
1843, which provided that the proceeds of escheated estates should 
be set apart for the support of the schools. However, the act 

346 Report Ind. State Supt. of Public Instruction, 1866, p. 73. 

347 Boone, R. G., History of Education in Indiana, p. 200. 

348 Data furnished, Sept. i, 1906, by Neb. State Supt. of Public Instruction. 

349 Report Ark. State Supt. of Public Instruction, 1895-96, p. 171. 



LOSS OF SCHOOL FUNDS 147 

failed to state the lapse of time after which heirs' claims to estates 
shall not be allowed. The result has been that not a dollar has 
been added from this source to the Common School Fund.^^" 

Florida in 1851 provided that the state should borrow from the 
principal of the Seminary Fund or Common School Fund not more 
Permanent School than $25,000 to be used to pay the general expenses 
General state""^ of the State. The act directed the governor to 
Expenses execute a bond for the sum so borrowed, bearing 

seven per cent annual interest.^^^ No provision was made for the 
time or means of paying the bond. Consequently its payment 
rests upon the pleasure of the state. 

"After May, 1861 (Arkansas), diverted from their proper pur- 
poses and used for general expenditures seven thousand, two hun- 
dred sixty dollars ($7,260) of the Seminary Fund and four thousand, 
six hundred thirty-three dollars ($4,633) of the Saline Fund," 
which should have been added to the principal of the Common 
School Fund.='52 

California, by an act of the legislature in extraordinary session, 
in 1906, authorized and directed a transfer of five hundred thou- 
sand dollars ($500,000) from the " State School Land Fund (the 
term applied in California to the uninvested proceeds of the sale of 
Common School Lands) to the general fund for the purpose of 
aiding in purchasing a site and erecting a state building in San 
Francisco. On this money the state pays four per cent interest.^^^ 
This five hundred thousand dollars ($500,000) is an indefinite 
loan.354 

The Common School Fund of Indiana has lost thousands, per- 
haps millions, of dollars from the failure to add to the principal 
Money Due Princi- nioneys which rightfully belonged to it. In 1872 
pal Not Added -^ ^^g claimed that two million dollars ($2,000,000) 
from the surplus profits of the Van Dalia Railroad, was due the 

350 Indiana Revised Statutes, 1843, Chap. XXVIII, Sec. 125; Boone, R. G., 
History of Education in Indiana, p. 203, note. 

3^1 Acts and Resolutions of the State of Florida, 1850-51, Chap. 342, Sees, i, 2. 

352 Reports of Commissioner of Education of U. S., 1871, p. 73; 1901, p. 393. 

353 Report Cal. Controller, 1905-06, p. 24. 

354 Statement furnished F. H. Swift, Dec. 15, 1906, by Cal. Controller. 



148 PERMANENT COMMON SCHOOL FUNDS 

Common School Fund as a result of the provision that taxes levied 
on corporations should constitute a part of the Common School 
Fund.^^^ Kansas, by her constitution in 1861, included among 
the sources from which her Permanent Common School Fund was 
to be derived the five hundred thousand acres of land to which 
the state was entitled under the Act of Congress, 1841.^^^ These 
lands were never added to the Permanent School Fund.^" We 
may estimate this loss at one million, five hundred thousand dollars 
($1,500,000) at least. 

The Literary Fund of Virginia is losing large sums annually 
through failure to add to it the proceeds of fines as provided by 
law. Joseph W. Southall, State Superintendent of Public Instruc- 
tion, in his report for 1904-05 wrote as follows: "This fund would 
be increased far more rapidly if some more stringent plan were 
adopted for the collection of fines imposed for offences against the 
commonwealth, and the proceeds arising from escheated property 
and all waste and unappropriated lands. It is safe to say that 
thousands of dollars are lost every year out of this fund for lack 
of a better system of collecting fines and escheating derelict prop- 
erty." 3^» 

The same condition seems to have existed in Wisconsin. The 
law of Wisconsin directs that the county treasurers shall remit all 
penal fines received by them annually to the state treasurer. It 
is further provided by the state constitution that the clear proceeds 
of all fines shall be added to the school fund. "For the past 
forty-five years only a small fraction of the amount due the Common 
School Fund has ever been added to it." ^^^ "In 1881, Attorney- 
General Wilson found that many county treasurers were placing 
the amounts of the fines paid to them, in general funds of their 
counties and not transmitting them to the state treasurer. The 

355 Boone, R. G. History of Education in Indiana, p. 206. 

356 Constitution Ordinances of Kansas, Sees. 2, 6, 7; General Laws of Kansas, 
1861, p. 5. 

357 Kansas School Laws, 1905, p. 5. 

358 Virginia School Report, 1871. Appendix, p. 19S; Ibid., 1904-05, Part I, 
p. XXXI. 

359 Report Wis. Supt. of Public Instruction, 1S92-93, p. 147, 



LOSS OF SCHOOL FUNDS 149 

trouble is not with the county treasurers ... it lies with the 
many justices of the peace who have come to consider the funds 
as official perquisites." ^^^ In 1892 Superintendent Oliver E. 
Wells wrote: "I recommend that the legislature give authority 
to some competent officer ... to examine the dockets of jus- 
tices of the peace and to commence action against those who do 
not make complete records of all convictions and fines in their 
dockets." ^^'^ In his report for the year 1893-94, the State Super- 
intendent of Public Schools wrote: "Prior to 1892 more than sixty 
thousand dollars ($60,000) annual loss to the school funds resulted 
from the failure properly to return the clear proceeds of penal 
fines as required by section two of Article X of the Constitution.'''^^ 
In 1904, twenty-four thousand, three hundred ninety-one dollars 
forty-nine cents ($24,391.49) was derived from penal fines which 
sum goes to increase the principal of the fund, but evidently the 
school fund is not receiving all that it should from this source. It 
is difficult to understand why a county like Dane should contribute, 
in 1904, two thousand, four hundred thirty-one dollars, ten cents 
($2,431.10) while Milwaukee county contributed only thirty-five 
dollars, seventy-seven cents ($35.77). Dane county has a popu- 
lation of about seventy-five thousand, five hundred, whereas Mil- 
waukee county has a population of nearly three hundred sixty- 
four thousand. Dane is the capital city county and may be 
assumed to be reasonably intelligent and law-abiding and there 
is no reason for believing that in Milwaukee county there is a vastly 
greater respect for law than in Dane county. 

The failure of banks and the general depreciation of securities 
and of property during and following the Civil War deprived many 
Losses Throuph school funds of millions of dollars. It is stated 
the Civil War ^.j^^^^ ^j^g ^j.^jg valuc of real and personal property 

of the eleven southern states * in i860 was five billion, six hundred 

* Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Caro- 
lina, South Carolina, Tennessee, Texas, and Virginia. 

360 Ibid., p. 151. 

361 Ibid., p. 152. 

362 Ibid., 1893-94, p. 17'. 



I50 PERMANENT COMMON SCHOOL FUNDS 

million dollars ($5,600,000,000); in 1870, two billion, seven hun- 
dred million dollars ($2,700,000,000).^^^ 

"The owner of a piece of property (in Louisiana) assessed at five thousand 
($5,000) dollars in 1850, paid ten ($10.00) dollars to the state. In 1873 he 
paid more than one hundred ($100) dollars on the same amount, a progress of 
1,000 per cent in twenty-three years. The property now assessed at five thou- 
sand ($5,000) dollars would hardly sell for half . . . whilst in 1850 it would 
have probably sold for more, thus making in reality the increase of taxation 
from 1850 to 1873 equivalent to two thousand per cent." 3m 

It was almost inevitable that the Civil War should prove dis- 
astrous to permanent funds within the control of the states. It 
is not surprising to discover that some states used their common 
school permanent funds to buy munitions of war, others to liqui- 
date the state debt following the war. Florida, Georgia, Massachu- 
setts, Missouri, Virginia, and Wisconsin are among the states that 
used portions of their funds for the expenses of the Civil War. 
The funds in Tennessee, North Carolina, Kentucky and in many 
other states were seriously diminished during the same era. In 
i860 Florida gave her School and Seminary Fund to the state 
government in exchange for certificates of indebtedness.^^^ The 
moneys belonging to the fund were used to purchase arms and 
ammunition and for other similar purposes. The result was that 
the only really productive portion of the school fund remaining 
at the close of the war was about six hundred thousand (600,000) 
acres of unsold school land.^^® Georgia lost all permanent common 
school funds between i860 and 1870.^'^^ In 1872 the state of 
Louisiana sold at public auction the whole Free School Fund 
which had been invested in state bonds, amounting to more than 
one million dollars ($1,000,000).^^^ The state has established a 

363 Report Va. Supt. of Public Instruction, 1872, p. 19S. 

36* Gayarre, Chas., Financial and Political Condition of La., published by John 
W. Madden, New Orleans, 1874. 

365 Laws of Fla., 1S60-61, Resolution No. 4. 

366 Report Fla. State Supt. of Public Instruction, 1872, p. 7. 

367 U. S. Bureau of Education, Circular of Information, 1SS8, No. 5, p. 26. 

368 Report U. S. Commissioner of Education, 1S94-95, II, p. 1303. 



LOSS OF SCHOOL FUNDS 15 1 

permanent debt in place of the fund so sold,^^^ but because the 
interest on this debt is paid from the school tax moneys the fund 
is practically a lost fund. The school fund in Missouri also suf- 
fered many losses during the period i860 to 1870.* 

Hon. John G. Dew, second auditor of Virginia, has the immedi- 
ate care of the Literary Fund of the state. Judge Dew reports 
the losses to the Literary Fund during and resulting from the 
Civil War, as follows: two hundred sixteen thousand dollars 
($216,000), diverted; three hundred thousand dollars ($300,000), 
lost on bank stock during the Civil War; fifty thousand dollars 
($50,000), lost on bank stock since the Civil War; seven hundred 
nineteen thousand, twenty-two dollars ($719,022), paid to West 
Virginia as her share of the Literary Fund.^^° 

Wisconsin borrowed one million, five hundred sixty-three thou- 
sand, seven hundred dollars ($1,563,700) from the school fund 
during the Civil War. This sum has never been returned and is 
practically a permanent debt secured by certificates of indebted- 
ness on which the state pays seven per cent interest. The interest 
is derived from state taxes whenever the income from other sources 
is insufficient.^^^ The principal of the Common School Fund of 
Tennessee is said to have amounted to one million, five hundred 
thousand dollars ($1,500,000) in the year i860, all of which was 
lost (1861-75).^''^ The loss to the Literary Fund of North Caro- 
lina has already been referred to. The failure of banks and the 
depreciation of securities which brought about losses to this fund 
were the result of the Civil War and the Reconstruction period. 

Prior to the Civil War the Literary Fund of North Carolina 
amounted to over two million dollars ($2,000,000). Less than one- 
half of this amount remained in 1869. The stocks belonging to 
the fund were sold at from ten to thirty-seven cents on the dollar. 
The proceeds of these sales were invested in fraudulent North 

* See above, also account given in Part II. 

389 Constitution of La., 1879, Art. 233; Constitution, 1898, Art. 257. 

370 Statement received Dec. 12, 1906, from Judge John G. Dew, by F. H. Swift. 

371 Statement received by F. H. Swift from Wis. Dept. of Public Instruction, 
Sept. 12, 1906. 

372 Report U. S. Commissioner of Education, 1895-96, I, p. 313. 



152 PERMANENT COMMON SCHOOL FUNDS 

Carolina tax bonds bought at a discount. The state repudiated 
these bonds in 1870 and the whole fund was then lost except a few 
thousand dollars.^^^ 

The history of the Kentucky School Fund and of the various 
seizures and diversions of it given in Part II, offers a most inter- 
esting example of the manner in which the permanent common 
school fund was misappropriated in this state. Here it may be 
said that in 1845, ^i^^ hundred seventeen thousand, five hundred 
fifty dollars ($917,550) of state bonds, representing state indebted- 
ness to the fund, were surrendered to the Board of Education and 
burned in the presence of witnesses. (This loss perhaps should 
have been included under the topic loss by fire!) It should be 
noted, however, that the act, which is quoted herewith, provided that 
lists of the bonds should be made and that the state was in no wise 
released from any obligation to pay the interest on the school fund. 

An act to increase the resource of the Sinking Fund and to pro- 
vide for the burning of certain State Bonds and Coupons. 

"Sec. 4. Be it further enacted, That it shall be the duty of the board of 
education and commissioners of the sinking fund, to surrender to the governor 
of the state bonds held by them respectively; and it shall be the duty of the 
governor, upon the receipt of said bonds, to cause the same to be cancelled 
and destroyed, by burning, in the presence of the second auditor and treasurer. 
But before the bonds held by the board of education shall be burned, duplicate 
lists thereof, described by dates and numbers, shall be made and signed by the 
governor, second auditor and treasurer, one to be delivered to the secretary 
of state and the other to the second auditor, to be by them recorded in v^rell 
bound books, in their respective offices, and it shall also be the duty of the 
second auditor and secretary of state, to deliver to the board of education a 
copy of said duplicate list, signed by them respectively, and sealed w^ith their 
respective seals of office; and when so signed, sealed, and deHvered, said 
dupHcate copy shall stand in place of the bonds of the state now held by the 
said board of education, but the same shall not be passed by delivery, be 
transferred, nor assigned by said board to any person or corporation, . . . 
which shall be expressed on the face of said lists. 

^^And be it further declared, That the rights of said board of education to 
the fund now claimed by it, shall not be regarded as in any wise impaired 
by anything in this act contained, or in any wise release the state from the 

373 U. S. Bureau of Education, Circular of Information, 1S8S, No. 2, p. 170. 



LOSS OF SCHOOL FUNDS 153 

obligation it is now under to pay the interest on the school fund; and in every 
respect, shall said fund be considered and held as sacred and inviolate as though 
the bonds had not been burned." 374 

In 1850 the revised constitution of Kentucky set aside over one 
million dollars of state bonds and seventy-three thousand dollars 
($73,000) of bank stock as an irrevocable debt to constitute a Per- 
manent School Fund.^^'' The interest on this fund is paid out of 
a sinking fund. 

By the year 1858 the Permanent School Fund of Rhode Island 
amounted to several hundred thousand dollars, over three hundred 
eighty-two thousand dollars ($382,000) having been added in 1837. 
In 1858, the state borrowed all but one hundred fifty-five thousand, 
five hundred forty-one dollars ($155,541) and then constituted that 
amount a Permanent School Fund.^^^ 

The losses suffered by many of the permanent common school 
funds already referred to were due, in part at least, to misappropri- 
Funds Mis- ation by the states of moneys belonging to these 

appropriated funds. Alabama, Louisiana, and Kentucky are 

three out of a considerable number of states which, have misappro- 
priated all or a part of their funds. Alabama by the year 1873 
had diverted one million, two hundred sixty thousand, five hun- 
dred eleven dollars ($1,260,511) belonging to her Permanent School 
Fund.^" The present Permanent School Fund of Kentucky appears 
to date from 1838. The Literary Fund, which the laws of Ken- 
tucky, 182 1, had established and provided should forever be 
maintained,^'^^ seems to have disappeared in less than fifteen years, 
having been used by the state to meet its own general expendi- 
tures.^^^ 

374 Ky. Acts, 1845, Chap. 264, p. 69. Cf. account given in Part II. 

375 Laws of Ky., 1845, Chap. 264, Sec. 4; Constitution of Ky., 1850, Art. ir, 
Sec. i; Report U. S. Commissioner of Education, 1899-1900, I., p. 512. 

376 Report U. S. Commissioner of Education, 1896-97, p. 642. 

377 Reports U. S. Commissioner of Education, 1874, p. 5, and 1903-04, p. LXV; 
Report Ala. State Supt. of Education, 1882, p. 7, from Bourne, E. G., History of 
Surplus Revenue, 1837, p. 47, foot-note. 

378 Acts of Ky., 1821, p. 35, Chap. CCLXXXIV, approved Dec. 18. 

379 "Ed. and Lit. Inst, in 1832, Barnard," Am. Journal of Ed., 1S77, p. 335; 
Report U. S. Commissioner of Education, 1895-96, p. 324. 



154 PERMANENT COMMON SCHOOL FUNDS 

In 1840, two years after a second attempt to establish a perma- 
nent state fund, the state seized the principal to liquidate the state 
debt. By 1843 the entire principal had been used for roads and 
the improvement of rivers, and the state owed the fund one hun- 
dred sixteen thousand dollars ($116,000).^^° 

The constitution of Louisiana of 1898 placed the Free School 
Fund among the perpetual debts of the state, reduced the interest 
from six to four per cent and declared that the same should be 
paid out of any taxes that may be levied and collected for general 
purposes of education.^*^^ In many states which have used all or 
part of the permanent common school fund we find the fund 
acknowledged as a state debt and the interest on it paid out of 
state taxes levied for general purposes. In such instances the 
fund continues to bring additional rQivenue for schools. In the 
case of Louisiana, however, owing to the fact that the interest 
on the fund is paid out of school taxes, the revenue for schools is 
in no way increased; it is merely "robbing Peter to pay Paul." 

It has often been but a step from borrowing the fund to repudi- 
ating the state's indebtedness to it. It has been noted that North 
states Borrow Carolina, in 1870, repudiated her indebtedness to 

and°Repudiate her Literary Fund which had arisen out of her 
^^^^^ investing of moneys belonging to that fund, in 

fraudulent bonds. Both before and since that time other states 
have pursued similar policies respecting their public permanent 
common school funds. 

Vermont established her first common school fund in 1825.^^^ 
In 1848 the state owed this fund two hundred twenty-four thousand 
dollars ($224,000), and appropriated the fund to pay the debt. 
That is, the state borrowed the fund and then in 1845 repudiated 
the debt.3«2 

Colorado invested four hundred eighty-eight thousand, six hun- 
dred thirty- three dollars, forty-four cents ($488,633.44) of moneys 

380 Report U. S. Commissioner of Education, 1899-1900, I, p. 512. 

381 Report Ver. State Supt. of Education, 1906, pp. 11, 12, Act passed Nov. 17, 
1825. 

382 Report Vt. State Supt. of Education, 1873-74, pp. 439-440. 



LOSS OF SCHOOL FUNDS 155 

belonging to the Public School Fund in the so-called "excess 
warrants" of 1887, 1888, and 1889, which with interest, in the year 
1906, amounted to over one million dollars. The state has redeemed 
about twenty-five thousand dollars of these warrants and the invest- 
ment without interest now (1906) represents four hundred sixty- 
three thousand, seven hundred sixty-five dollars, seventy-five cents 
($463,765.75). The state has twice repudiated this indebtedness, 
and the warrants cannot be paid until some time in the future 
when a constitutional amendment shall be adopted.^^^ 

Chapter I and the preceding paragraphs of the present chapter 
have pointed out that a number of states have borrowed the princi- 
Significance of pal of their permanent common school fund, 
Permanent Itat^ entirely or in part, that they have used the moneys 
Debts * belonging to these funds and established in place 

thereof permanent debts or accounts on which they pay a fixed 
rate of interest. Maine, Michigan, and Ohio are among the states 
which have pursued this policy almost from the beginning. Such 
funds cannot be said to be lost as a source of school support, but 
in view of the fact that the interest on the principal is in most 
cases derived from taxation, directly or indirectly, they do not 
serve the purpose of relieving the people of the state from taxation, 
but are rather additional means of levying taxes. 

The same is true to a large extent of funds which have been in 
part borrowed by the state or invested in state bonds, the interest 
on which is paid out of state taxes. It is somewhat difficult to 
state the real significance of funds which have become perma- 
nent loans. Many states have pursued the policy of using all or 
a part of the principal of the permanent common school fund and 
substituting state bonds for the moneys borrowed. There are 
many considerations which encourage or favor this policy. In 
the first place, state bonds are considered one of the best and safest 
of all investments. In the second place, the question may well 
be asked why should the state not use moneys lying uninvested in 

Compare Tables I and III, Chapter I. 
333 Data furnished F. H. Swift by Katherine L. Craig, Colo. Supt. of Public 
Instruction. 



156 PERMANENT COMMON SCHOOL FUNDS 

its own treasury when it is in need of them. What advantage 
would it be to the schools of the state for the state to go outside to 
borrow money when it has moneys at hand which are unemployed ? 
Without attempting to render any decision regarding the wisdom 
of this policy it may be well here to note that certain states expressly 
provide against loans to the state from the school fund, as, for 
instance, West Virginia by her constitution. Furthermore, it may 
be well to distinguish between real investments in state bonds 
which the state must redeem at their maturity and investments 
in bonds which, in all probability, will never be redeemed, or 
instead of such investment in irredeemable bonds, the creation 
of a permanent account. It is true the account established or 
the certificates of indebtedness given by the state in exchange for 
the productive fund assure the schools a revenue, — a revenue in 
some cases greater than could be derived from the investment of 
money in ordinary securities. It would be very difficult in many 
states at the present time to place funds as so to bring five, six, 
and seven per cent, rates paid by a number of states on their 
credit funds and permanent debts. On the other hand, one of the 
purposes for which permanent school funds were established was 
clearly to aid the people of the state in raising money for the sup- 
port of the schools by taxation. When, therefore, the nominal 
income of the fund is derived from taxation, as it frequently is in 
the case of credit funds, permanent loans, and debts, the above 
important purpose is thwarted. The nominal amount of the school 
fund of Wisconsin, in 1892, was $3,358,502.50. Of this $1,563,700 
consisted of certificates of indebtedness, leaving the actual amount 
available for investment, $1,794,802.50.^^'* The Superintendent 
of Public Instruction of Wisconsin wrote several years ago with 
reference to the fund of his own state: 

"The certificates of indebtedness are evidences of the disappearance of 
nearly one-half of the school fund. The law which directed the investment 
of the school funds in the purchase of state bonds provided for the cancellation 
of the bonds and substitution therefor of the certificates of indebtedness. The 
certificates are non-negotiable and non-transferrable. No provision whatever 
is made for their payment. The discretionary authority of the commissioners 



LOSS OF SCHOOL FUNDS 157 

who are clothed with constitutional powers over its investment is thereby 
destroyed by . . . statutory enactment. The rate of interest on these 
certificates is seven per cent. The efifect is the creation of a perpetual state 
debt requiring the levy and collection of an annual state tax to the amount 
of $157,570 to pay the interest thereon. The interest paid . . . thus far 
amounts to $4,200,000 and the process seems just begun. . . . Additional 
burdens of taxation are the only fruits of the school fund, the very result it 
was intended to avoid. 

"This seems evident that a wise administration of all the provisions relating 
to the school fund should have resulted in a permanent endowment of from 
$15,000,000 to $20,000,000; that we have instead cash and money invested to 
the amount of $3,401,461.49 and a permanent state debt of $2,251,000; that 
the application of the available productive funds to the liquidation of the state 
debt would practically leave the state as though no provision had been made 
for the support of its schools; that the necessity for the disappearance of this 
money is not apparent; that the laws and records bear witness to transactions 
of more than doubtful propriety; and that the security for the debt is of ques- 
tionable validity." ^s* 

It is scarcely necessary to add that this statement applies not 
to the fund of Wisconsin alone but to many so-called credit funds, 
permanent loans, and debts. 

The discussion of losses to the permanent common school 
funds which has occupied such a large portion of this chapter, may 
well be closed by a summary showing the more important causes 
of these losses, and by a table showing the amount lost or diverted 
in some of the states, in so far as it has been possible to ascertain 
the same. The statement made at the beginning of this discussion 
to the effect that the account here is by no means complete should 
be kept in mind when consulting the table. The real condition 
of these funds can be best realized by consulting Table VII at the 
close of Chapter I. 

Table XIX. Summary of the More Important Causes of Loss to the Public 
Permanent Common School Funds in the United States 

1. Lands sold for less than real value. 

2. Unpaid for lands reverted to township. 

3. Deeds improperly recorded or not recorded. 

4. Sold by towns and no records of proceeds. 



3S4 



Report Wis. Supt. of Public Instruction, 1892, pp. 152-154, 161. 



158 



PERMANENT COMMON SCHOOL FUNDS 



Table XIX — continued 

5. Bad loans. 

6. Unpaid notes. 

7. Unpaid interest on bonds or notes. 

8. Mismanagement. 

9. Dishonest management. 

10. Absconding of school fund officers or debtors. 

11. Theft or embezzlement. 

12. Losses by fire. 

13. Insutficient legislation. 

14. ISIoneys due principal not added. 

15. Moneys due principal diverted. 

16. Fund borrowed by the state. 

17. Fund used for state expenses. 

18. Fund used to pay state debts. 

19. Fund misappropriated by state. 

20. Used for other purposes. 

21. Exchanged for state securities — indebtedness later repudiated. 

22. Fraudulent bonds. 

23. Failure of state banks. 

24. Depreciation of securities. 

25. Civil War. 

Table XX. Losses to Public Permanent Common School Funds^ 



State c 


Amount Lost or 
Diverted 6 


Date 


Title of Fund 


Credit Funds 
and Perma- 
nent State 
Debts c 6 


Ala. 


$ 669,086 
2,056,714 


1848 


U. S. Surplus Revenue Loan 
Sixteenth Section Land Fund 


$2,831,295 


Ark. 


26S,75r.49 


After 1868 


U. S. Surplus Revenue Loan 


1,128,500 




1,250,000 


Before 1870 


Common School Fund 




Cal. 


6,000,000 


Before 1861 


Sixteenth and Thirty-sixth 
Section Lands Township 
Funds 


2,026,000 


Col. 


463,765-77 


After 1887 


Public School Fund 




Conn. 


138,640.09 


Before 1810 


School Fund 




Fla. 


Unknown 


1860-65 


State School Fund 




Ga. 


750,000 
350,000 


1860-65 


Common School Fund 

U. S. Surplus Revenue Loan 




111. 


613,362.66 




School Fund Proper 





^ This table must not be understood as necessarily showing the complete loss in 
any state nor all states which have suffered loss. 

« States having credit funds or permanent debts, not named here are Delaware, 
Maine, Michigan, and Nevada. See Table III, Chap. I. 



LOSS OF SCHOOL FUNDS 

Table XX — continued 



159 



State c 


Amount Lost or 
Diverted 6 


Date 


Title of Fund 


Credit Funds 
and Perma- 
nent State 
Debt.s c b 


111. 
Ind. 


$ 335,592.33 
3,000,000 




U. S. Surplus Revenue Loan 
Common School Fund 




Iowa 


125,000 


Before 1868 


Permanent School Fund 


$ 10,937 


Kan. 


2,000,000 




State Permanent School Fund 




Ky. 
La. 


1,568,996.66 

850,000 
1,652,947.86 


Before 1845 
Before 1872 


Permanent School Fund 

U. S. Surplus Revenue Loan 

Free School Fund 


2,418,997 
1,130,867 


Md. 

Mass. 
Miss. 


477,919.14 

743,42975 
2,842,572 
50,000 


Before 1872 

1839 
1859-64 


U. S. Surplus Revenue Loan 
U. S. Surplus Revenue Loan 
Massachusetts School Fund 
Chickasaw Fund 


1,002,023 


Mo. 

Neb. 


100,000 
259,842.87 


Before 1870 
1897 


Township School Fund 
Permanent School Fund 




N. H. 

N. Y. 
N. C. 

Ohio 


35,000 (inc 
333,862.17 
1,400,000 

1,133,757-44 
Unknown 


ome) 1867-83 

1837-1905 

1860-70 

1860-70 


Institute Fund 

U. S. Surplus Revenue Loan 

Literary Fund 

U. S. Surplus Revenue Loan 


59,470 
4,902,110 


Ore. 


20,000 


Before 1905 


Common School Fund 




Penn. 


1,500,000 


Before 1870 


Common School Fund 




R. I. 


370,000 


Before i860 


U. S. Surplus Revenue Loan 




S. C. 


Unknown 








Tenn. 


388,985 


Before 1850 


Common School Fund 


2,512,000 




1,500,000 


1860-65 


Common School Fund 




Texas 


700,000 (income) 










Before 1900 


Permanent School Fund 




Vt. 


224,000 


1845 


Common School Fund 


775,269 


Va. 
W. Va. 


556,000 0. 
6,000 


1860-65 
Before 1871-75 


Virginia Literary Fund 
School Fund 




Wis. 

Wyo. 


1,563,700 
5,768.35 


1860-65 
1893 


School Fund 

Common School Permanent 

Fund 


1,563,700 



" Not including $719,022.62 paid to West Virginia as her share of fund. 

* This table must not be understood as necessarily showing the complete loss in 
any state nor all states which have suffered loss. 

"^ States having credit funds or permanent debts, not named here are Delaware, 
Maine, Michigan, and Nevada. See Table III, Chap. I. 



CHAPTER VII 

PURPOSE AND EFFECTS OF PUBLIC PERMANENT COMMON 
SCHOOL FUNDS 

The easiest way to kill an institution in a republic is to provide it with an 
endowment which removes from the people all responsibihty of contributing 
to its support. 

"There is surely a great need of a permanent school fund upon the principle 
that the best state schools result from a true equilibrium between state and 
local support and control." Report of the State Commission on Permanent 
Common School Funds of Vermont, p. 27. 

These funds have been wheel, ballast and lever of our states' systems of 
free schools. They set those systems in motion and kept them going. They 
maintained the equilibrium. They lifted them to higher and higher levels. 

Public sentiment regarding the need of free schools and the 

obligation to support them has passed through a marvelous 

transformation in the last hundred years. Con- 
Early Public Senti- . . . „ • , 
ment Respecting ditions existed quite universally m the earlier 

Free Schools ... , , , . , . 

part of the nineteenth century and continued m 
many states long after the middle of that century, which are diffi- 
cult to describe and more difficult for the present generation 
to realize. Schools were rare. School buildings were wretched 
and foul. Large numbers of them were not supplied with even 
bare necessities: thousands of them were destitute of water-closets. 
Teachers were untrained and ignorant; their wages small and 
uncertain, and frequently could not be collected when due. Edu- 
cational opportunities in different parts of the same state were 
totally unequal. Some districts maintained no free schools. 
Others supported free schools for a brief period. 

Taxation for schools, permissive in many states, compulsory 
in a few, frequently could not be levied owing to the hostile attitude 
of the public. Worse still, the real conditions could not be ascer- 
tained as there was almost no state supervision of schools and efforts 
to collect the most meager data proved futile. There were no 

160 



PURPOSE AND EFFECTS OF SCHOOL FUNDS i6i 

means at hand for equalizing or remedying conditions. Laws 
enacted for the benefit of free schools could not be enforced. The 
income of funds established to support free schools was often 
used for private schools or for the expenses of the state which not 
infrequently borrowed and exhausted the principal. Public senti- 
ment respecting the establishing and maintaining of free schools 
ranged all the way from indifference, disbelief, and contempt, to 
open hostility. 

Evidences of this attitude are to be found prior to 1850 in every 
state in the Union to a greater or less extent. 

Indifference to 

Free Schools For example, the constitution of Indiana, in 1816, 

in the West -, 

stated : 

"It shall be the duty of the general assembly, as soon as circumstances will 
permit, to provide by law for a general system of education ascending in regular 
gradation from township schools to a state university, wherein tuition shall be 
gratis and equally open to all." 389 

Every township had been granted school lands upon the admission 
of the state into the Union, and the state itself had established 
funds to aid in the support of common schools. Notwithstanding 
this early provision, it is stated that from 1830 to 1840 almost no 
free public schools existed. 

During this period "the building of school-houses, the estab- 
lishment and conduct of schools . . . was left to popular vote. . . . 
Illiteracy in the state was alarming and seemed to be growing 
worse. In 1840 one-seventh of the population were wholly unlet- 
tered and a much greater proportion were very ignorant. Educa- 
tionally Indiana stood sixteenth among the twenty-three states." ^^^ 

It may be argued that the existence of such conditions in the 

West was due, in part at least, to the hardships of pioneer life and 

the sparseness of population, but in the East 

Contempt for Free ^ , ^ 

Schools in the where public schools had existed since colonial 

East and South , , . , , rr^, 

days, conditions were frequently little better. The 
free public school continued to be regarded as a charity school pro- 
vided for those who were unable to pay. In Massachusetts, the 

389 Constitution of Indiana, 1816, Art. IX, Sec. 2. 

3S0 Report Ind. Supt. of Public Instruction, 1885-86, p. 12. 



l62 PERMANENT COMMON SCHOOL FUNDS 

law of 1827 had required all public schools to be free, supported by 
taxation, nevertheless public schools were "languishing for support 
and to a degree destitute of public sympathy." ^^^ In 1834 Massa- 
chusetts contained no less than nine hundred fifty private schools 
and academies.^^^ 

The free school in the South was regarded, generally speaking, 
distinctly as a charity school. Striking evidence of the truth 
Free Schools of this is presented in the fact that the portion 

ChlritJ^Schoois of the Permanent School Fund established by 
m the South Georgia in 182 1, which was devoted to the sup- 

port of free schools, was commonly known as the Poor School 
Fund.^^^ The original act by which the Literary Fund of Mis- 
sissippi was established expressly states that the revenue of this 
fund shall be applied to no purpose whatever other than for the 
education of the poor white children.^^^ The legislature of Vir- 
ginia which provided for the establishment of the Literary Fund 
regarded it as a fund for the education of the poor. " This present 
general assembly solemnly protests against any other application 
of the said fund by any succeeding general assembly to any other 
object than the education of the poor." ^^^ 

In Florida in 1850 there were only sixty-nine public schools; in 
i860, ninety-seven. In i860 only two thousand, thirty- two pupils 
were reported as attending public schools, whereas four thousand, 
four hundred eighty-six were attending private schools.^^^ 

The attitude toward public schools is further revealed by the 
fact that the income of funds established for the 

Free School 

Moneys Used for support of tlicsc schools was frequently used to pay 

Private Schools . . i i t • • i i • 

teachers in private schools. It is said that m 
Indiana prior to 1850 the revenue of the permanent common school 

391 Boutwell, G, S., Mass. School Fund, lis Origin and History, Report Board 
of Education of Mass., 1859, PP- 38-47- 

392 "Mass. and Its Early History," Lowell Institute Lectures, pp. 486-487. 

393 Cf. account given in Part II. 

394 Alden's Digest of the Laws of Miss., 1839, Chap. 51, Sec. 9, p. 367. 

395 Acts of Va., 1809, Chap. XIV, citation taken from Miller, History of Educa- 
tion in W. Va., p. 29. The Virginia fund appears to have been established in 1810. 

396 U. S. Bureau of Education, Circular of Information, 1888, No. 7, pp. 19-20. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 163 

funds was distributed to denominational schools and in many in- 
stances turned over to individuals who engaged teachers to instruct 
their children, with the children of others who might wish to join 
them.^^'' In 1844 the income of the Common School Fund of 
Tennessee " when received by the counties was, in nearly all of the 
districts, distributed among the private schools in the ratio of their 
enrolled pupils and was used as a credit on the tuition of those 
who were willing to accept it. It thus came to be regarded as a 
sort of charity fund." ^^^ In Florida it is stated that between the 
years of 1852 and i860 or later the income of the state school 
fund was in many instances distributed to the teachers of private 
schools.^^^ 

Frequently moneys and lands reserved for the establishment 

of funds for the support of free schools were left unemployed. 

The counties of Georgia made little use of the 

Appropriations 

for Free Schools provision of the grant of One thousand acres of 
land each for the establishment of free schools,^°*^ 
and only one township in Florida appears to have ever attempted 
to make use of its sixteenth section lands.'*^^ Indiana, in 1837, pro- 
vided for the distribution of one-half of her share of the United 
States Surplus Revenue Fund among the organized counties of the 
state for the use of common schools. Three counties, De Kalb, 
Lake, and Wells, never claimed their share.^*'^ 

That the failure to establish free schools was due to the attitude 
of the public toward them and not due to the failure to provide 
Legislation in laws for them is amply borne out by the numerous 

Schools" ^^^ 2,cts passed in all sections of the country. For 
Ineffective example, more than three hundred acts were 

passed in Tennessee relative to school funds.^*'^ Intelligent legis- 
lation was impossible as the facts on which to base it were not in 

S87 Rawles, W. A., Centralizing Tendencies in the Administration of Ind., p. 13. 

388 Report Tenn. State Supt. of Public Instruction, 1891, p. 34. 

so* U. S. Bureau of Education, Circular of Information, 18SS, No. 7, p. 15. 

** U. S. Bureau of Education, Circular of Information, No. 4, 18S8, p. 27. 

*>i Ibid., 1888, No. 7, p. 20, note 2. 

*^^ Boone, R. G., History of Education in Indiana, p. 196. 

*03 Report U. S. Commissioner of Education, 1895-96, I, p. 313. 



i64 PERMANENT COMMON SCHOOL FUNDS 

the Hands of the legislators and there was no means of securing 
them. Maine, Massachusetts, New York, and Florida each 
attempted to secure data from local units to serve as a guide in 
distributing funds and making laws. How fruitless their attempts 
were will appear in the account of the effect of permanent common 
school funds upon school returns. Here, however, Florida's ex- 
perience may be described. After Florida had established a Per- 
manent Common School Fund in 1848, she was unable to secure 
reports from the schools as to school attendance. From 1850 to 

1 85 1 it was provided by law that a county, in order to receive its 
share of the revenue of the School Fund of Florida, must submit to 
the State Superintendent, prior to May, 1852, a report of the num- 
ber of children in each district of the county from five to eighteen 
years of age who had actually attended school in the district within 
three months of the date of the report. This law was repealed in 

1852 owing to the impossibility of enforcing it. 

That the moneys upon which public schools depended prior 
to the establishment of public permanent funds were small, uncer- 
tain and fluctuating will appear upon recalling: 
Uncertainty and & rr r & 

Variation in the more important early sources of school sup- 

School Support . . .. . . , 

port: tuition, gifts, appropriations, lotteries, pro- 
ceeds of licenses and fines, taxes on occupations and commodities, 
and taxes on banks. Where schools were supported by rate bills 
their very existence depended on the attendance of the pupils. 
Home economy placed a premium upon staying away from school. 
It is almost needless to say that at the time towns and districts 
were refusing the state school moneys, they were opposing the 
levying of local taxes for schools. Taxation for teachers' wages 
was looked upon not only as a burden but as an imposition. This 
will be seen from a survey of conditions existing in many states, of 
which New York and Indiana may be taken as examples. 

New York, in 181 2, provided for the distribution of the common 
school fund revenue by an act which required each town to raise 
a tax equal to its full share, but left participation in the revenue 
to the option of the towns.^"^ The Act of 1795 had provided for 

^O'* Laws of New York, 35th Session, 1S12, Chap, 242. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 165 

the distribution of the annual appropriation of one hundred thou- 
sand dollars ($100,000), and had made a like provision, save that 
it required the town to raise a tax equal to one-half its share.^"'' 

The indifference of the people towards public schools was soon 
evident. As long as participation in the public money was optional 
large numbers of towns refused to take advantage of the public 
money.^*^^ The result was that in 1814 an act was passed making 
participation and consequently local taxation compulsory .'*°^ Indi- 
ana had permitted local taxation for school buildings since 1824. 
But as late as 1855 the Supreme Court declared it unconstitutional 
to levy a local tax for the payment of teachers' wages,^"^ and it was 
not until 1867 that local taxation for this purpose was allowed.^"^ 

Despite the conditions which have been described in this chapter 

thus far it would be a mistake to suppose that public opinion was 

a unit in opposing free schools. Although the 

Public Permanent dominant sentiment respecting them gave expres- 

School Funds f b & i- 

Abolition of sion to itself in indifference, scorn, and hostility, 

School Tax. , , , 11. , , 

Illustrated by yet there were those who regarded free schools 

Connecticut , , i i i , i t 

not only as a necessary burden but as an obliga- 
tion in which lay opportunity as well as duty. Previous chapters 
have related the steps by which the policy of providing perma- 
nent funds for the support of common schools was adopted in 
turn by town, state, and nation. The aim or incentive which in- 
spired those who labored for the establishment of permanent com- 
mon school funds in so far as it was related to schools and not to 
the sale of unsettled lands, was usually largely the result of pre- 
vailing conditions and sentiments. It is not surprising, therefore, 
that in Connecticut, which, in striking contrast to the majority of 
states, had long compelled its towns to levy a school tax, the estab- 
lishment of permanent funds should be regarded chiefly as a 
m.eans of escaping from taxation for schools. Perhaps, almost 

<05 Laws of New York, 1795, Chap. 75. 

<08 Randall, S. S., History 0/ the Common School System of the State of New 
York, ed. 185 1, p. 13. 
407 Laws of New York, 1814, Chap. 192, Sec. 21. 
*08 Boone, R. G., History of Education in Indiana, p. 157. 
lo^ Boone, R. G., History of Education in Indiana, p. 29; Act Mar. 9, 1867. 



1 66 PERMANENT COMMON SCHOOL FUNDS 

from the first, the purpose in the minds of the legislators and direct- 
ors of the school policy of Connecticut was that the revenue of 
the school fund should pay in full the wages of the common school 
teachers, and so relieve the towns and school societies from the 
burden of local taxation. The act which established the school 
fund and subsequent acts relating to its management show this in 
several ways: (i) by the absence of any provisions requiring state 
or local taxation for schools; (2) by refraining from naming any 
conditions whatever which must be fulfilled by towns and districts 
in order to share in the revenue; (3) by omitting to state any length 
of time which schools must keep open during the year; (4) by 
specific provision in 1801 that school societies which had expended 
all public moneys for teachers' wages might be considered to have 
fulfilled all necessary conditions even though some of the dis- 
tricts under their jurisdiction had conducted no school during the 
year. 

The Act of 1795 which established the School Fund of Connecti- 
cut, placed no limit to the use to which the revenue of the school 
Teachers' Board fund could be put. It Specifically provided that 
Oldest Lawful^ under certain conditions the society might vote 
^^j®*^*^ to devote its school fund revenue to the support 

of the Christian ministry or public worship. But the first dis- 
tribution of this revenue did not occur until 1799, and the act 
of that year made the sole lawful objects to which the reve- 
nue could be applied the board and wages of teachers in ele- 
mentary schools or schools of a higher order in which Latin 
and Greek could be studied. Participation in the school fund 
revenue was optional. The Acts of 1795 and 1799 made no pro- 
vision compelling school societies to accept their share. Such 
provision appeared unnecessary as the revenue was given almost 
unconditionally. 

Owing to this total absence of requirements, the establishment 
of the School Fund of Connecticut ushered in a policy by which 
Evil Effects of the the responsibility of supporting schools was re- 
Connecticut Pohcy ^noved almost entirely from the community 
directly benefited by the school, and thrown back upon the 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 167 

state. The evils inherent in such a poh'cy were not foreseen by 
those who inaugurated it. Nevertheless these evils soon showed 
themselves and the School Fund of Connecticut became no- 
torious as an example of a magnificent endowment creating dis- 
aster. 

The Connecticut Code in force from 1700 to 1798 had compelled 
towns or school societies of more than seventy families to maintain 
Effect of Con- a school for eleven months. Many county towns 

Fund^on "school maintained a grammar school. The most serious 

Term and Support ^^f^^^ ^f j^e School Fund Acts of 1 795, 1799, 

and 1800, was that they failed to compel districts to maintain 
schools for any specified term. The law of 1801 permitted them 
to close school whenever the moneys provided by the state had 
been exhausted.'*^^ Not until 1840 was a law passed which at- 
tempted to reestablish a legal term. In that year it was enacted 
that no district should be entitled to any portion of the public 
moneys unless it had maintained a school for at least four months 
in the year, taught by a teacher or teachers fully qualified. It was 
not until 1858 that the six months' term required by the Code of 
1700 was restored.'*^^ The result was that between the years 1801 
and 1840 many schools were closed and others were kept open no 
longer than public money lasted.'*^^ A second serious defect in 
the School Fund Acts of 1795 and 1801 was that they contained 
no provision compelling the larger towns and societies to maintain 
grammar schools. 

Of all the evils following from the establishment of the School 

Fund of Connecticut perhaps the most disastrous was its effect 

. upon local taxation. As pointed out above, the 

Effect of Connecti- ^ '- 

cut School Fund Code of 1700, modified in 1754, which continued 

on Taxation . •, o 1 1 

in force until 1798, had compelled all towns to levy 
a local tax of at least forty shillings on every thousand pounds."*^^ 
The School Fund began to contribute revenue for the support 

4" Act of 1801, Par. 3. 

«2 Laws of Connecticut, 1858, Chap. XLII. 

*13 Conn. School Report, 1853, p. 45. 

*i* Report Conn. Board of Education, 1876, p. 103. 



1 68 PERMANENT COMMON SCHOOL FUNDS 

of schools in 1799. With the gradual increase of its income 
there was an increase in disinclination to raise taxes. From 
1821 to 1854 rate bills, gifts and income of permanent funds 
were almost the only sources of school support. During this 
period a town or society school tax was virtually unknown in 
Connecticut.^^^ 

In conclusion it should be noted that the Connecticut School 
Fund failed to make the schools of the state free. For seventy- 
three years after its establishment rate bills continued to contribute 
a considerable portion of the support of public schools.* 

The decline of the common school system of Connecticut under 

the influence of the School Fund was a most convincing demonstra- 

^ .. ^ tion of the principle that an endowment which 

Second Aim of r- r 

Permanent School relieves the community from the necessity of 

Funds to Incite 

and Relieve Taxa- raising moneys by local effort is an injury alike 

tion. New York, • i i 

Maine Massachu- to the community and to the cause the endow- 

setts as Exeimples , . , . , , mi i i • i 

ment is seeking to advance. The lesson which 
Connecticut had learned at such a cost was not lost upon the other 
eastern states. They saw that the easiest way to kill an institu- 
tion in a republic is to provide it with an endowment which removes 
from the people all responsibility of contributing to its support. 
An early report of the State Superintendent of Public Instruction 
of New York contains the following statement: "Those who 
founded the common school system of this state never contem- 
plated that the permanent public fund would, at any time, yield a 
revenue adequate to the support of such an establishment." The 
Act of 1 81 2, as previously stated in this chapter, which was passed 
three years prior to the first distribution of the revenue of the New 
York Common School Fund, required that the town, raise a tax 
equal to its share of the revenue in order to participate in the bene- 
fits of the Common School Fund.^^^ 

Maine had made taxation for schools compulsory in 1821, the 
year following her admission into the Union. It was not until 
1828 that she established the Permanent School Fund and not until 

* See Table VIII, Chapter II, p. 27. 

*18 Laws of New York, 35th Session, 1812, Chap. 242, 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 169 

1 85 1 that the first distribution of this revenue was made. Mean- 
while the schools depended very largely upon the proceeds of local 
taxes. No provision for permitting the discontinuance of these 
taxes was ever made. 

Massachusetts made local taxation compulsory seven years before 
the establishment of the School Fund. In January, 1828, Hon. 
W. B. Calhoun in a report made for the committee on education 
of the house of representatives of Massachusetts, declared "that 
means should be devised for the establishment of a fund having 
in view not the support but the encouragement of common schools 
and the instruction of school teachers.^^^ In February, 1828, the 
same committee specifically states that a fund sufficient to support 
common schools and normal schools would injure the school sys- 
tem and decrease public interest in it, and cites Connecticut as an 
example of this; but adds that a fund sufficient to give towns about 
one-third the amount they themselves raised would be an incentive 
to interest and effort. The act by which the Common School Fund 
of Massachusetts was created provided that there shall never be 
paid to any city, town or district a greater sum than is raised therein 
respectively for the support of schools.^^^ 

In the public land states the permanent common school 
fund has, in many instances, supported the schools largely and 
often entirely during the first years of the state's existence. 
On the other hand, as pointed out in the chapter dealing with 
the early sources of school support, the policy of supporting 
schools by local taxation had become established in some of the 
western territories and continued after their admission into the 
Union. 

The report of the Special Commission on the Permanent Com- 
mon School Fund of Vermont, 1906, contains an excellent state- 
ment of the purpose of a permanent fund. The statement given 
by this Commission was made after a careful study of the permanent 
school funds in the different states. On p. 23 the report of the 
Commission reads: "The primary fact is that good schools should 

<" Boutwell, G. S., Mass. School Fund, Its Origin and History, pp. 46-47. 
«8 Laws of Mass., 1834, Chap. CLXIX. 



lyo PERMANENT COMMON SCHOOL FUNDS 

exist everywhere, and their existence can be insured only by fixed, 
existing endowment funds devoted under the laws of the legisla- 
ture, to their effective supervision and maintenance. This is apart 
from any local, direct support, which should be actively continued 
and enforced by law." The Commission states the necessity of a 
permanent school fund in the following words: "There is surely 
a great need of a permanent school fund upon the principle that 
the best state schools result from 'a true equihbrium between state 
and local support and control.' " ^^^ 

The statement of the purpose of a permanent common school 
fund in the words of this Commission should be, "first, to render 
the means of school support certain and fixed, beyond recurring 
yearly debate and taxation of the people; second, to conserve and 
extend the two working principles of the existing law, especially 
of school taxation and school opportunity; and, finally, to lay the 
foundation of a true and actual supervision by the state, of public 
instruction in connection with its actual direction of an accounting 
for school moneys disbursed, particularly such funds as the state 
itself supplies to towns by taxation or through permanent invest- 
ment for the support of schools." '^^ 

The aims expressed in this statement are not theoretical. They 
represent the actual achievements of other states resulting from 
the creation of permanent endowments for schools. ^ The effects 
of these funds in public land states will be treated of in the latter 
part of this chapter. These states provided for permanent endow- 
ments for schools, coupled in many instances with state supervision, 
at the time of their admission into the Union. They do not offer 
as good an opportunity, therefore, of observing the influence of the 
permanent funds upon educational conditions as is to be found in 
commonwealths which at first possessed no state-controlled fund. 
For this reason Connecticut, New York, Maine, Massachusetts, 
Indiana, and Florida have been selected as states to be studied in 
detail. 

419 Report of the State Commission on Permanent Common School Funds of 
Vermont, p. 27. 

420 Ibid., p. 32. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 171 

The aims which the states have sought to reahze through their 
Aims of Permanent permanent common school funds arc revealed 
Reveaied^in*^^ in three classcs of constitutional and legislative 

8^/0^^°°^^ ^"^ provisions respecting these funds: 
Provisions (j) Provisions concerning the lawful use of the 

fund's income. 

(2) Provisions concerning conditions which must be fulfilled, 
commonly spoken of as conditions of participation, by the county, 
town or district in order to receive a share of the income. 

(3) Provisions concerning the method and basis of apportion- 
ment. 

The most important effects of the permanent common school 
funds arose out of these three classes of provisions and in many 
cases, as will appear later, the ability to enact and enforce these 
provisions was itself a result of the influence of the permanent 
funds previously established. The remainder of this chapter will, 
therefore, be devoted chiefly to the consideration of these provi- 
sions, and the aims they reveal and their results. 

There has been little uniformity in the objects to which different 

states have permitted the income of the permanent common 

school funds to be applied. In some states pro- 
Lawful Uses '- ^ ^ 

visions appear to be stated only in general terms, 

such as that the revenue of the permanent school fund "shall be 
faithfully appropriated for maintaining a system of free schools, 
and for no other purpose whatever." Some states leave it to the 
state superintendent or other authorities to interpret the general 
terms. 

As pointed out above, Connecticut, the first state to create a 
permanent common school fund, made teachers' wages and board 
the sole objects to which the income of the School Fund might 
lawfully be applied. New York followed the example of Connecti- 
cut and made the payment of the board and wages of teachers the 
sole lawful use of the income of the Common School Fund from 
the time of its first distribution in 1816. Maine hesitated to make 
restrictions regarding the application of the public school moneys 
but gradually defined the uses. The first distribution of the 



172 PERMANENT COMMON SCHOOL FUNDS 

revenue of the Permanent School Fund took place in 1851. The 
law appears to have left it largely to the towns to decide to what 
objects of school expenditure their share of the income should be 
applied. Chapter 68 of the Law of 1876 required a municipal 
officer to make sworn returns of the amount of all moneys received 
or expended for school purposes, but did not call for a specifica- 
tion of the objects to which the moneys had been applied."*^^ In 
general the Maine laws have simply provided that the revenue 
must be applied to the support of public schools and have left the 
interpretation of the term "support" to the State Superintendent 
of Schools or to other school oflScers. The present school law, 
1905, names seven objects as the only ones to which the income of 
the Permanent School Fund shall be devoted: (i) teachers' wages; 
(2) teachers' board; (3) fuel; (4) janitors' services; (5) conveyance 
of pupils; (6) pupils' board; (7) tuition. Moneys for erecting or 
repairing buildings, for the purchase of school property, apparatus, 
books and for insurance must be raised by local taxation.^^^ 

The laws of Tennessee require that the revenue of the Perma- 
nent School Fund shall be used for the support and maintenance 
of the public schools of the state,''^^ but leave the exact application 
of the income "to the judgment of the district directors who are 
to use the school fund apportioned to their district ... in such 
manner as will promote the interests of the public schools." "^-^ 

The failure to name in the laws the specific objects to which the 
income of the permanent common school fund may be applied is 
generally the result of one of several conditions. Where the public 
is indifferent and it is difficult to get local units to accept a share 
of the public moneys it seems unwise to make restrictions which 
will in any way deter them from accepting it. The existence of 
such conditions no doubt largely accounts for the failure of Florida 
to make provisions of this sort at first.'^^ In some of the public 
land states the income of the permanent school fund has been so 

*2i Me. School Report, 1901, p. 89. 

^2 Me. School Laws, 1905, p. 8, Sec. ig. 

*23 Tenn. School Laws, 1895, p. 19, Sec. 34. 

424 Ibid., p. g, Sec. 20. 

425 Laws of Florida, 184S, Chap. 231, Sec. i. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 



173 



large, and the difficulties of supervision, resulting from the lack 
of means of communication in pioneer days, so great that it has 
been left to the districts to make such use of the moneys as they 
saw fit. 

Massachusetts has made no statutory provisions respecting 
objects to which the income of the School Fund may be applied. 
The only statement is found in the form prescribed for the sworn 
certificate of the school committee, sent annually to the Secretary 
of the State Board of Education.^'^'' From 1846 to 1854 the general 
educational expenses of the state and of normal schools were paid 
from the proceeds of lands belonging to the Massachusetts School 
Fund.^^ Since 1854 these expenses have been paid out of one- 
half the income of the fund received for these purposes, the other 
half of the income being distributed among the towns.^^ 

The following table represents the more important objects to 
which the income of the permanent common school funds may be 
lawfully applied, and some of the states providing them: 



Table XXI. 



Lawful Objects to Which Reventje of Public Permanent 
Common School Funds May Be Applied * 



Objects 



States 



I. For teachers' wages and training 










I. Per cent which must be 


appl 


ed 


to 


100% — Conn., Ind., Mich., 


teachers' wages only 








Mo., Neb., R. I., Utah, W. Va. 
96%— Ala. 
90%— Cal. 


2. Teachers' wages chiefly "• 








Del., la., Kan., Me., Mass., 
Md., Minn., Miss., Va. 


3. Teachers' board 








Maine 


4. Teachers' institutes only 








S. C. and N. H. 


5. Expenses of summer normal schools 


Virginia 



42SO Sixty-second Annual Report of the Board of Education of Mass., 1897-98, 
p. 209. 

*28 Law of Mass., 1846, Chap. 219; Ibid., 1849, Chap. 117, Sec. 3. 

427 Laws of 1854, Chap. 300, Sees. 2, 3. 

" These states devote their revenue chiefly to teachers' wages. Cf. account 
given for each state in Part II. 

* Taken from accounts given for each state in Part II. 



174 PERMANENT COMMON SCHOOL FUNDS 

Table XXI — continued 



Objects 


States 


II. 


For school-houses, construction, equipment, 
and care 
6. Building and repairing school-houses 






and purchase of school furniture 


Miss., Mont. 




7. Exclusively for building public school- 






houses 


N. C. 




8. Rent and insurance 


Mont. 




9. Fuel 


Me., Mass., Miss.* 




10. Janitor service 


Me., Mass. 




11. School libraries 


Cal., la. 




12. Sundries 


Cal., la. 


III. 


For pupils' tuition and supplies 


- 




13. Pupils' tuition in another district 


la., Me. 




14. Pupils' transportation (conveyance) 


Me., Mass., Mont. 




15. Pupils' board 


Me. 




16. Free text-books 


Del., Md.,c Mass., Mont. 


IV. 


Supervision 






17. Superintendent of schools 


Mass. 




18. State department of education 


Ky. 


V. 


19. School officers, committee, etc. 


Mass., N. J., Va. 


20. For all school expenditures 






Except purchasing of lots and 






buildings 


Colo., Kan. 




Except repairing and furniture 


Colo. 


VI. 


For support of schools, apparently including 
all expenditures 






21. Stated in general terms 


Ark., Fla., Ida., 111., Kan., La., 
Minn., Miss., N. J., N. Mex., 
N. Y., N. C, Ohio, Okla., Ore., 
S. D., Tenn., Vt., Wash., Wyo., 
Tex. 




22. Revenue not kept separate from taxes 


Ga., Mont. 



The second class of legislative and constitutional provisions 
Conditions of which reveal the aims the states have sought to 

Participation realize through permanent school funds, are pro- 

visions respecting conditions which must be fulfilled by the school 

* Including water. 

* Including stationery. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 175 

unit in order to receive a share of the permanent common school 
fund. Among the oldest and most influential of such conditions 
are, first, the submission of school returns, or reports by the local 
communities to the state; second, the levying of local taxes; and 
third, the maintenance of school for a term of specified length. 

The thing most necessary for the establishment of an effective 
system of schools was to secure returns from the districts and town- 
First Condition: ships throughout the state. Several things might 
School Returns |^g achieved through such returns. First of all, 
these returns would furnish data for intelligent legislation; second, 
they could be used as a basis for the wise distribution of the income 
of the permanent common school fund; and third, through these 
returns a bond of union would be established between the state 
department of education and the local communities. 

Connecticut, whose provisions respecting participation in the 
revenue of the School Fund were remarkable chiefly for their 
absence of requirements, made it necessary for school societies to 
furnish the state with some sort of returns. The Act of 1799, 
referred to above, provided, "That, in the future no order (for a 
share of the revenue of the School Fund) shall be drawn by any 
(school) society except on the receipt of a certificate, signed by the 
school society committee, stating that all moneys drawn from the 
public treasury . . . have been faithfully applied ... in paying 
and boarding instructors." Meager as these reports were, they, 
nevertheless, opened communication between the school societies 
and the State Commissioner of the School Fund. New York 
required the submission of school returns from the first.^^ Maine, 
by the law of 1850, provided that towns from which no returns are 
received by the Secretary of State by the loth of April shall receive 
no portion of the revenue of the Permanent School Fund.^^ 

As stated in a previous paragraph, Connecticut did not require 
Second Condition • school societics to levy a local tax in order to share 
Local Taxation ' ^^ ^^^ income of the School Fund. New York, 
profiting by the experience of Connecticut, provided in 1812 

<28 Report N. Y. State Supt. of Public Instruction, 1833, pp. 12-13. 
<29 Acts of Me., 1850, Chap. 123, Art. 10, Sec. 6. 



176 PERMANENT COMMON SCHOOL FUNDS 

that every town sharing in the revenue of the Common School 
Fund must raise taxes equal to its share.'*^'' Finding that many 
of the towns did not choose to share in the public moneys under 
such conditions, participation which had been at first optional 
was made compulsory .'^^^ 

The law by which the Massachusetts School Fund was created 
provided, "That there shall never be paid to any city, town or 
district a greater sum than is raised therein respectively for the 
support of common schools." ^^^ Five years later this state pro- 
vided that a legal tax of $1.25 must be levied for every child of 
school age within the town, city, or district.^^ In 1849 this rate 
was raised to $1.50:'^^'* Since 1865 the rate has been $3.00.'*^^ 
Massachusetts has further encouraged local taxation for schools 
by her method of apportioning school revenues. Since 1891 the 
portion of the income of the school fund which any town received 
has been determined in part by the ratio of its school tax to its 
total tax, towns having the largest ratio receiving the largest 
share.^^^ 

As stated in the earlier part of this chapter, it was not until 
1841 that Connecticut required societies and districts to maintain 
Third Condition: ^^^^ schools for a Specified term.^^' New York 
Fixed School Term appears to have required, from the first, districts 
to maintain schools for at least three months. The length of the 
term which schools must be maintained in order to receive a por- 
tion of the revenue of the permanent common school fund varies 
to-day in different states all the way from three months in Cali- 
fornia and Kansas and other states, to nine months in Connecticut 
and New York. 

In addition to the three classes of conditions already mentioned, 

*30 Laws of New York, 181 2, Chap. 242, 

431 Ibid., 1814, Chap. 192, Sec. 21. 

432 Laws of Mass., 1S34, Chap. CLXIX, Sec. 3. 

433 Ibid., 1839, Chap. 56. 

434 Ibid., 1849, Chap. 117, Sec. 3. 

435 Acts of 1865, Chap. 149, Sec. i. 
438 Acts of Mass., 1891, Chap. 177. 

437 Laws of Conn., 1841, Title IV, Sec. 32. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 



177 



Miscellaneous 
Provisions 



there are many others which have been employed to good advantage. 
Most of the states seem to have made use, and in some cases 
most important use, of their permanent common 
school funds as a means of inducing or compelling 
communities to improve local opportunities for education within 
themselves. The character and number of conditions of partici- 
pation vary in the different states even more widely than the lawful 
objects to which the public school moneys may be applied. In 
certain states, such as Arkansas, Louisiana, Tennessee, and Ohio, 
no restrictions or conditions are named.* On the other hand, in 
Connecticut five conditions must be fulfilled; in Massachusetts 
and Minnesota, four. Some of the most important requirements 
are the legal qualification of teachers, the visitation of schools, 
compliance with requirements regarding courses of study, pro- 
vision of free text-books, enforcement of the truancy law. 

The following table presents the conditions of participation 
which must be fulfilled by the cities, towns, and districts in the 
states mentioned, in order to share in the revenue of the permanent 
common school funds: 



Table XXII. Conditions of Participation 



Conditions t 


States 


I. Submission of school returns and reports 




Submit reports required by law to county 




superintendents 


Ore., Ind., Kan., Nev. 


Returns previously submitted 


Conn., 111., Me., Mass., Minn. 


Submit state superintendent reports re- 




quired by law- 


Utah 


Must send returns as to enumeration of 




pupils required by law 


Mo., N. Dak. 



* This statement is subject to correction. In certain states the conditions of 
participation are left to the regulation of the State Department of Education and 
do not appear in the laws. See paragraph on Massachusetts under title "Lawful 
Uses," p. 173. 

t Taken from the accounts given separately for each state in Part II. In cer- 
tain states the conditions which must be fulfilled are left to the regulation of the 
State Department of Education and are not stated in the laws. 



178 



PERMANENT COMMON SCHOOL FUNDS 

Table XXII — continued 



Conditions * 


States 


II. 


Raise local tax 






Raise fixed local tax 


Del., Mass., N. Y., R. I." 




Must raise and expend school moneys 






required by law 


Me., Vt. 




Raise local tax sufficient with school fund 






to support a school 


Wash. 


III. 


Must expend moneys for lawful objects 
Moneys drawn from public treasury ex- 






pended for teachers' wages only 


Conn. 




Must expend for tuition amount received 






from state auditor 


Ind. 




Must not divert school library moneys to 






other purposes 


N. Y. 


IV. 


Legal qualification of teachers 

Schools taught by duly examined and 






qualified teachers 


Conn., Fla., 111., Ky., Mich., 
Minn., Me., Neb., Nev., N. Y. 


V. 


Maintenance of school for lawful term 
Must maintain school not less than: 






Nine months 


Conn., N. J. 




Eight months 


Fla., N. Y. 




Six months 


Cal., Ky., Nev. 




Five months preceding year 


Mich., Minn. 




Twenty weeks annually 


Me.,* Utah 




Five months during current year 


Va., Wash. 




Three months 


Colo., Kan., Mo.,* Mont., 
Neb.,c Wyo. 




Twelve school weeks (sixty days) 


Ore. 




Maintain public schools as required by law 


Mass. 


VI. 


Attendance 






Must average not less than fifty pupils 


Fla. 


VII. 


Visitation of schools 






Schools visited according to law 


Conn. 



ffl Town must raise by local tax amount equal to the share it receives from the 
state. 

* Maintain school for six months if a tax of forty cents on $100 assessed valua- 
tion within the district plus public funds will maintain it for that length of time. 

« Not less than three months in a district having less than twenty pupils. Not 
less than six months in a district having from twenty to seventy-five pupils. Not 
less than nine months in a district having more than seventy-five pupils. 

* In certain states the conditions which must be fulfilled are left to the regu- 
lation of the State Department of Education and are not stated in the laws^ 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 

Table XXII — continued 



179 



Conditions * 


States 


VIII. 


Equipment 

School facilities and accommodations 
suitable and satisfactory from a sani- 








tary standpoint 


Del., 


Fla., N. J.,«i Va. 


IX. 


Course of study 

Instruction given in subjects required by 








law 


Me. 






Regular and systematic instruction in 








physiology and hygiene 


Mich. 


, N. Y. 




Must not permit sectarian instruction 


Mont 


, Nev. 


X. 


Schools must be free to all children 

School free to every child in the district 








between six and twenty years of age 


Ky. 




XI. 


Free text-books 








Furnish suitable (free) text-books 


Me. 




XII. 


Enforce truancy law 








Comply with truant law 


Mass. 




XIII. 


Enforce compulsory education law 








Must enforce compulsory education law 


N. Y. 




XIV. 


General and inclusive 

Full compliance with all laws and deci- 








sions pertaining to common schools 


N. Y. 




XV. 


Apparently none « 

No restrictions or conditions named or 








exacted 


Ark., 
Tex. 


Ida., la.. La., Tenn., 




Not stated « 


Ala., Miss., Ohio, S. Dak. 




Not learned « 


N. C. 


N. Mex., Okla., S. C, 






Ariz., 


Ga., I. T., La., Md., 






N. H. 





By provisions for apportioning public moneys among school 



^ Plans for school buildings must be submitted to State Board of Education for 
suggestions and criticisms, certain architectural requirements being specified by 
law. 

' Subject to correction. 

* In certain states the conditions which must be fulfilled are left to the 
regulation of the State Department of Education and are not stated in the 
laws. 



i8o PERMANENT COMMON SCHOOL FUNDS 

units according to some fixed basis, e. g., the rate of local school 
tax or the number of teachers employed, aims are 

Aims Revealed in i i i i -, -, . . 

Basis of Appor- revealed and results secured as objective and 
as definite as those arising from naming condi- 
tions of participation and lawful objects. 

The question of the basis upon which the income of the perma- 
nent common school funds can be most effectively distributed is 
but a part of the larger question of the distribution of the school 
moneys. Mr. Cubberley in his volume. School Funds and Their 
Apportionment, has given a most able discussion of the different 
methods and bases which have been employed. The present dis- 
cussion will attempt to show the evolution of the more important 
of these methods. 

In Connecticut, from 1799 to 1800, the revenue of the School 
Fund was distributed among the school societies according to 
First Basis: Total their lists of polls and valuation. The result was 
Population ^Yiax the largest and most populous societies re- 

ceived the greater portion.'*^^ In New York, until 1851, the revenue 
of the Common School Fund was distributed among the counties 
and towns in proportion to their total population.^^^ The present 
method of apportionment of the income of the Permanent Common 
School Fund in New York is complex. The total population serves 
as a partial basis.^^° 

In the year 1820 a more just basis was established in Connecticut, 
namely, the number of children from four to sixteen years of age 
Second Basis: residing in the several societies. School socie- 

Schooi Census ^.jgg ^^gj-g abolished in Connecticut in 1856 and 
towns became the units of distribution.^^ With this exception, the 
basis of distribution has continued practically unchanged in Con- 
necticut up to the present time. The State Controller apportions 
the income of the School Fund among the towns upon the basis 

*38 Report Conn. Board of Education, 1876, pp. 111-113. 

*39 Unpublished account by N. Y. State Dept. of Finance, received Dec. 23, 
1906. 
440 N. Y. Consolidated School Law, 1905, Title 2, Art. i, Sec. 7. 
442 Public Acts of the State of Conn., 1856, p. 39, Chap. VII, Sec. 3. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS i8i 

of their school population (four to sixteen years) .^^ This basis 
of apportionment was adopted by Maine and Florida and many 
other states when they established their permanent common school 
funds and is the sole basis employed to-day by twenty-eight states. 
Several other states employ it as a fractional or part basis. 

The evils resulting from apportioning the funds on the basis 
of school population were early felt in Minnesota. The Superin- 
E ii Results of tendent in his report for 1875 recommended a 
School Population change to the number of children enrolled and the 

Basis. Minnesota 

Adopts Average next legislature enacted a law to this effect. Su- 
perintendent D. Burt, in his report for 1876, p. 9, 
wrote: "When our older states enacted laws for apportioning 
school money upon the basis of children between certain ages, 
nearly all such persons were actually members of the public schools, 
therefore such laws really made the scholars enrolled the basis 
of apportionment. The old plan (based on school population) 
gave an unfair advantage to districts in which there happened to 
be parochial schools maintained at private expense. In a (certain) 
district ... a settlement of Norwegians has maintained a private 
school so that the enrollment in the public school has never ex- 
ceeded twenty, while the district has drawn money on seventy-eight 
persons, fifty-eight of whom have not in the least increased the 
expenses of the public school." ^^ 

Superintendent Burt states further that the effects of the school 
population basis are especially disastrous in large cities where an 
undue per cent of the school population are at work, and where the 
schools continue to draw money for them. "Thriving centers 
of business attract . . . large numbers of persons between five 
and twenty-one who go thither to work and not to go to school. 
Upon the old plan (school census basis) out of three districts in 
a certain county, one educated eight hundred six scholars, on each 
of which it received in one year from the state fund $2.05; another 
educated five hundred twenty, on each of which it received $1.33; 
the third educated one hundred seventy-four, receiving only $1.25 

*^ Conn. School Law, 1896, Sec. 182, p. 69. 

*** Report Minn. Supt. of Public Instruction, 1876, pp. 9-11. 



i82 PERMANENT COMMON SCHOOL FUNDS 

to each scholar. This plan of distribution afforded no inducement 
to open public schools no matter how many children were receiving 
no education." By opening one school for two persons for three 
months in the year a district drew public money on the whole 
mass.""^ 

"In some counties there have been annually from ten to thirty 
schools opened on the smallest possible scale, just long enough to 
draw public money. A majority of the children . . . could be 
left unschooled, and still the current school fund had to be appor- 
tioned even to districts that made no educational provision for 
many of their children. There was also no incentive to open 
schools in new counties. . . . The larger the scholastic popula- 
tion became before the schools were organized, the more money 
was drawn from year to year. To one county apportionments 
were made for four years, the last one on two hundred ten children, 
before it opened a school; to another, for six years; and to one for 
nine years before it secured schools. Another county accumulated 
about two thousand dollars ($2,000) before organizing schools, 
on which it lately supported four, whose average length was five 
and one-half months, without the aid of any special tax." '^ In 
Minnesota, prior to 1876, the income of the Permanent Common 
School Fund was distributed upon the basis of school population. 
In 1876 a law was passed making the number of pupils actually 
enrolled in school the basis.'*^ 

School population was the basis employed by Florida until 
1894, when a constitutional amendment made the average attend- 
ance upon school the basis.""^ Next to school 

Average Attend- i . i . i i 

ance Adopted by population, average attendance is the most widely 

employed basis. It is found, among other states, 

in Florida, Minnesota, North Dakota,^' and Washington""® and 

in part determines the distribution of the revenue of the Permanent 

*45 Ibid., pp. 11-12. 

^"le Constitution of Fla., 1894, Art. 12, Sec. 7. 

447 Data furnished, Sept. 12, 1906, by W. L. Stockweli, State Supt. of Public 
Instruction of N. Dak. 

448 School Laws of Wash., 1901, p. 25, Title II, Chap, i. Sec. 22. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 183 

Common School Fund of New Jersey.*^'' In North Dakota the 
income of the Permanent School Fund is apportioned among the 
counties upon the basis of the number of children between six and 
twenty who have attended school sixty days, "exclusive of those 
who have attended educational institutions maintained strictly by 
the state." ^^ In Washington the income of the Common School 
Fund is apportioned among the counties in proportion to the total 
number of days of attendance.^^ 

Three bases of apportionment have been presented thus far: 
total population, school population, average attendance. Average 
attendance is the only one of the three which tends to incite local 
communities to establish schools. There is nothing in any one 
of them to incite an increase in the number of teachers employed 
or to improve the school organization. Moreover, these methods 
of distribution fail to take into consideration the assessed valuation 
of the property of the town or district. Consequently it often 
happens that the communities which are most able to support 
schools are aided as much, in many cases more, than poorer dis- 
tricts. Again, these methods of apportionment place no premium 
upon local taxation. Under them a community that taxes itself 
for schools just enough to satisfy the requirements of the law may 
receive proportionately more than the community which taxes 
itself in excess of the law.* Certain states, appreciating not only 
the possibility of making a more just and equitable distribution, 
but also the possibility of making the basis of apportionment pro- 
mote certain definite ends, have developed complex bases upon 
which the income of their permanent common school funds is 
apportioned. 

Scarcely any fund shows so rapid an evolution and such ready 
adaptability to changed conditions, from whatever point it may be 
History of Massa- viewed, as the Massachusetts School Fund. Dur- 
chusetts Basis. jj^g ^^^ ^^^^^ course of its history the basis of 

apportionment appears to have been changed, to a greater or less 

♦ An excellent discussion of this subject will be found in School Funds and 
Their Apportionment, by Ellwood P. Cubberley. 
**9 N. J. School Law, 1903, Sec. 183. 



1 84 PERMANENT COMMON SCHOOL FUNDS 

extent, not less than thirteen times. The bases upon which its 
revenue has been distributed may be summarized here as follows: 

In 1835 the income was halved; one-half was apportioned among 
the cities, towns, and districts on the basis of population, the other 
half in proportion to the local school tax.'*^" In 1839 school popu- 
lation was made the basis; '^^ in 1840, total population.^^ In 
1841 school population was restored as the basis."*^^ In 1845, 
1849, and 1854 certain unimportant changes were made. Since 
1854 the income of the Massachusetts School Fund has been halved, 
one-half has been used for paying all appropriations for general 
educational expenses not otherwise provided for; the other half 
has been distributed to the towns.'*^^ In 1866 the method of 
distribution underwent a radical change. Seventy-five dollars 
were to be apportioned to every town and city. The remainder 
was to be apportioned upon the basis of school census among the 
towns in which the district system did not exist, upon the basis 
of their school census (5-15 years). No noteworthy change oc- 
curred until 1874, when the assessed valuation of towns was made 
the basis. Towns were divided into four classes for annual appor- 
tionment. One-half of the income was distributed to towns whose 
valuation did not exceed ten million dollars. Each town whose 
valuation did not exceed one million dollars received two hundred 
dollars per annum; each town whose valuation exceeded one million 
and did not exceed three million dollars, received one hundred 
fifty dollars; each town whose valuation was between three and 
five million dollars received one hundred dollars. The remainder 
of this half of the income was distributed among the towns whose 
valuation did not exceed ten million dollars, including the three 
classes of towns already mentioned, in proportion to their school 
population (5-15 years) .^^^ 

Since 1874 the tendency has been to limit the income of the fund 

450 Fiftieth Report of the Board of Education of Mass., p. 91. 

451 Laws of Mass., 1839, Chap. 56. 

452 Laws of Mass., 1840, Chap. 7. 

453 Laws of Mass., 1841, Chap. 17. 

464 Laws of Mass., 1854, Chap. 300, Sees. 2, 3. 
455 Acts of 1874, Chap. 248, Sec. i. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 185 

to towns of less and less value and to apportion to these towns an 
increasing sum. In 1891 the income of the fund was limited to 
towns whose valuation did not exceed three million dollars. The 
portion of the income remaining after the distribution of it among 
the towns on the basis of their value, was divided among those 
towns whose tax for the support of schools was not less than one- 
sixth of their whole yalue/^^ In 1893 the amount distributed to 
towns whose valuation did not exceed five hundred thousand 
dollars was increased from two hundred seventy-five dollars to 
three hundred dollars. In 1903 the income of the fund was limited 
to towns whose valuation did not exceed two and one-half million 
dollars.* 

Among other states which have employed a complex method 
of apportionment may be mentioned California, New Jersey, New 
York, Rhode Island, and Wyoming. In some of these states we 
find a fixed amount paid to every district, town, or city for each 
teacher employed, or for each school maintained, or for each dis- 
trict, or for each superintendent or supervising principal. The 
remainder is distributed upon one of the several bases, viz., total 
population, school population, school attendance, number of dis- 
tricts. 

The following table presents a statement of some of the bases 
of apportionment and indicates the states which have employed 
them at one time or another. The effort has been made to make 
this table show the bases at present employed by the states, but 
this has not been possible in all cases owing to the fact that the 
last compilations of school laws have in some cases been inacces- 
sible. Idaho, Oregon, and Nebraska, which are here given as 
apportioning their funds upon the basis of school population 
have recently passed laws providing that each district receive 
a fixed sum according to a method similar to that employed by 
Wyoming. 

* For criticism of the present method of apportionment employed by Massa- 
chusetts, consult E. P. Cubberley, School Funds and their Apportionment^ 
pp. 212 fit. 

**" Acts of Mass., 1891, Chap. 177, Sec. i. 



i86 



PERMANENT COMMON SCHOOL FUNDS 



Table XXIII.* Bases of Apportionment of Income of Public Permanent 
Common School Funds 

1. simple bases 



Bases 


States 


I. 


To townships in accordance with 
amount of principal standing to 






their credit 


Miss. 




Chickasaw revenue among Chicka- 






saw counties on basis of their area 




2. 


According to share in original capital 
According to number of teachers 


Ohio 


3- 


School population 


Ala., Ark., Cal.,ffl Colo., Conn., Ida., Ind., 
la., Kan., Ky., La., Me., Md., Mich., 
Mo., Mont., Nev., Okla., Ore., R. I.,f 
S. Dak., Tex., Utah, Va., W. Va., Wis., 
111., Wyo. (in part.) 


4- 


Average attendance 


Fla., Minn., N. J.,<= N. Dak., Wash. 



2. COMPLEX bases * 



Bases 


States 


Fixed amount to each 




District 


Wyo., $150 


School 


R. I., $100 


Teacher 


Cal., $250; N. J., $200; N. Y., $100 (for 




each additional teacher) 


Superintendent 


N. J., $600 


Assessed valuation 


Mass., N. Y. 


School taxation 


Mass. 


School census 


R. I. 


School attendance 


Cal. (average), N. J. (total) 


Number of districts 


N.J. 


Total population 


N. Y. 



a California School Laws, 1903, p. 102, Sec. 1858. 

« New Jersey School Law, 1903, Sees. 182-183, as amended by Law of New 
Jersey, 1906, Chap. 241. 

f Rhode Island School Law, 1896, Chap. 53, Sec. 2. , 

* Data in this table taken from separate accounts for each state in Part II. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 

3. DESCRIPTION OF COMPLEX BASES * 



187 



Cal.« 



$250 for each teacher in every county, or in every city and county. 
Twofold basis: (a) Number of teachers. 

(b) Average attendance for remainder. 
Del. 

All the income, except $300, which is given to Sussex county, is divided into 
three equal parts, — one part to each of the three counties. County's 
share is equally apportioned to districts within said county, according 
to the number of districts. 
Mass. * 

To towns, by Commissioners of Massachusetts School Fund. 

1. Assessed valuation. 

2. Rate of school taxation — the higher the rate the larger the quota. 
Twofold basis: 

I. None to any town valued over $2,500,000. Towns whose assessed 
valuation is, 







Receive 








A nniially 




Not over 


$500,000 


$500 


If rate of tax is $18 or more on 
$1,000, receives $75 more 


Between 


$500,000 & 1,000,000 


300 




(< 


1,000,000 & 2,000,000 


150 




" 


2,000,000 & 2,500,000 


75 





N.J. 



. Remainder of income is distributed to towns whose assessed valuation 
is less than $2,500,000 and whose annual school tax is not less than 
one-sixth of entire tax, in a proportion determined by the ratio of 
school tax to total tax. 

Fourfold basis: 

1. Number of teachers employed. 

$200 for each teacher employed one year. 

$180 for each teacher employed less than one year and not less than 
four months. 

2. $600 to each district which has employed a superintendent or super- 

vising principal devoting his entire time to supervision. 

3. Total school attendance. 

4. Number of districts. 



" California School Laws, 1903, p. 102, Sec. 1858. 

* Massachusetts Acts, 1903, Chap. 456. 

'^ New Jersey School Law, 1903, Sees. 182-183, as amended by Law of New 
Jersey, 1906, Chap. 241. 

* Data in this table taken from separate accounts for each state in Part IL 



i88 



PERMANENT COMMON SCHOOL FUNDS 



N. y." 

By commissioner of education among districts and cities. 
Threefold basis: 

I. Assessed valuation of district. 

Each district whose assessed valuation is not more than 



Receives 



Between 



$20,000 

!>20,000 & 40,000 
40,000 & 60,000 



t)200 

ISO 



To each Indian reservation for every teacher employed thirty-two 

weeks or more, $150. 
$125 to all remaining districts and each city of state. 

2. Number of teachers employed. 

To each district, Indian reservation, and city, $100 for every addi- 
tional duly licensed teacher. 

3. Population. 

The remainder to counties in proportion to their population. 
N. C.« 

Uses her fund exclusively as a loan fund to districts for building school-houses. 
R. I./ 

To towns. 

1. Number of schools, $100 to each school — not more than fifteen schools 

in one town. 

2. School population (five to fifteen years). 
Vt.ff 

$15,000 of income is annually divided among towns and cities and unorganized 

towns and gores in same manner as the $45,000 Reserve Fund is divided. 
The remainder of the income is divided by the State Treasurer among towns, 

cities, and unorganized towns and gores according to number of legal schools 

maintained the preceding year. 
Legal schools are schools maintained at least twenty-eight weeks, taught by 

qualified teachers, reporting and returning registers as required by law. 
Wyo. 

$150 to each school district in county. 
Residue on basis of school population. 

The more important provisions regarding the lawful use of the 



^ Laws of New York, igo6. Chap. 698, Sec. i. 

« Act passed Jan., 1903. 

'Rhode Island School Law, 1896, Chap. 53, Sec. 2. 

P Acts of Vermont, 1906, Sec. 13, approved Dec. 14, 1906. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 189 

revenue of the permanent common school funds, requirements for 
their share in it and the methods and bases of apportionment have 
Aims Revealed been described. Thus far there has been little 
in Lawful Uses direct consideration of the aims sought through 
these provisions nor of the results obtained. In general two classes 
of aims and of results have been sought and secured : first, assistance 
in school support, and second, the education of public sentiment 
respecting free schools. 

With the exception of those estates which provide the lawful uses 
of the permanent school funds revenue in general terms, and except- 
ing also states, such as Georgia and Montana, where the revenue is 
not kept separate from state taxes, the objects provided by law fall 
into the following groups: (i) teachers' wages and training; (2) 
school-houses, equipment, and care; (3) tuition and supplies; (4) 
supervision; (5) all school expenditures except purchasing lots and 
furniture and building and repairing school-houses; (6) apparently 
all expenditures for schools. The first four groups show definite 
ends which states have aimed to accomplish through their perma- 
nent common school funds. To secure good teachers, to make 
their wages certain and to increase their efficiency is the aim under- 
lying the objects named in the first group; to provide good, 
sanitary, well-equiped school-houses is the aim of the second 
group; to give to every child in every part of the state the best 
opportunities of education is the aim discernible in the provisions of 
the third group; to give unity through organization and to raise 
the standard of supervision and method are the aims underlying 
the fourth group. 

The conditions that the states have provided which must be 

fulfilled by local units in order to receive their share of the income 

of the permanent common school fund revenue 

Aims Revealed in 

Conditions of reveal aims similar in many respects to the aims 

Participation 1 1 • r • • • i ^ 1 

revealed m the provisions respecting lawful uses 
of this revenue. The earlier provisions regarding the lawful use 
of the revenue resulted in supplying stable means of support to the 
most important and heaviest items of school expenditure. In 
these provisions there was an opportunity of educating public 



I90 PERMANENT COMMON SCHOOL FUNDS 

sentiment. Nevertheless, in the conditions of participation the 
states have found the largest opportunity for educating public 
sentiment in the matter of supporting schools. Through the sub- 
mission of returns to the state department, the states have sought 
to establish a bond of union between the local communities and 
the state school authorities. As soon as a certain tax is required, 
or the maintenance of a school for a legal term in order to share in 
the public revenue, the sentiment of the communities throughout 
the state will tend to approach a certain standard. 

The earlier methods of apportionment, total population and 

school population, were adopted simply as means of distributing 

the school revenue equally, as it was supposed, 

Aims Revealed ^ jy ff> 

in Methods of among the different communities of the state. 

Apportionment 

There was little opportunity through them to 

develop public sentiment. The more complex methods of appor- 
tionment which have been described have aimed directly to equalize 
the cost of maintaining schools and to equalize also the oppor- 
tunities of education throughout the state. This is done by giv- 
ing to the smaller and poorer districts a fixed sum as large as shall 
be received by the largest districts, as in Wyoming, or by giving to 
the towns of the lowest valuation the largest sum, as in Massachu- 
setts. The second aim revealed in the more complex methods of 
apportionment is to encourage local communities to employ super- 
visors, more teachers, to increase the average attendance, to in- 
crease taxation for schools and the number of schools. 

A comparison of the educational conditions described in the 
opening paragraphs of this chapter v/ith those of the present 
readily shows to what an extent the aims mentioned in this chapter 
have been realized. How far the existence and support of free 
schools are results of the iniluence of the permanent common school 
funds will perhaps be evident from a description of the effects of 
these funds upon the different aspects of the school system which 
they have been employed especially to promote. 

Nine states have made teachers' wages the sole object to which 
the income of the permanent common school fund might be law- 
fully applied. A number of others have made it a chief ob- 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 191 

|ect.* In states such as New York where local tax was required 
for participation in the revenue of the Permanent Common School 

Effect of Permanent ^^^^' ^^f ^^^^ ""^^^^^^ ^'^ supplying twO SOUrcCS 

School Funds on from which monev for teachers' wages was de- 
Teachers' Wages • J rm rr 

rived. The effect of such provisions was not 
limited simply to assuring the teacher his wages. By it public at- 
tention was turned to the importance of the teacher's wage. A fur- 
ther result was that districts were compelled to raise money for erect- 
ing, repairing, and equiping school-houses and for school supplies. 
The wages of teachers have been increased, indirectly, through 
the permanent common school funds by the part these funds have 
Effect on played in increasing the efficiency of teachers. 

Teachers' The provision that districts in order to share in 

EfBciency 

the revenue of the permanent common school 
fund must employ teachers duly qualified, has resulted in raising 
the standard of qualifications. New York made this a condition 
from the very first.^^ Connecticut as early as 1841 provided that 
no school districts should be entitled to any portion of the public 
money unless the school had been taught by a teacher or teachers 
duly qualified.'^^ Over one-fifth of the states in the Union have 
made this a requirement for participation in the revenue of the 
permanent common school fund. 

In 1896 Massachusetts provided that "With the approval of the 

state board of education, there may be paid from the income of 

^ ,^ the school fund to any town having a valuation 

Massachusetts -^ " 

School Fund of less than $2 c;o,ooo (amended so as to read 

Devoted to , , * 

Advancing $350,000 by chapter 498, Acts of 1897) a sum not 

exceeding two dollars per week for the actual 
time of service of each teacher approved by the school committee 
of said town, after special examination as to exceptional ability, 
employed in public schools of said town: which same shall be added 
to the salary of such teacher." '^^^ Massachusetts has employed 

* See Table XXII, Lawful Objects, p. 181. 

*S7 Report N. Y. State Supt. of Public Instruction, 1833, pp. 12-13. 

458 Laws of Conn., 1S41, Title IV, Sec. 32. 

«9 Acts of Mass., 1896, Chap. 408. 



192 



PERMANENT COMMON SCHOOL FUNDS 



the revenue of her School Fund for increasing the efficiency of 
teachers further by using it to support normal schools. Prior to 
1854, certain moneys devoted to the principal of the Massachusetts 
School Fund were used to support normal schools. Since 1854 a 
portion of the income of the fund has been devoted to this cause.^^" 
The income of the permanent common school fund has been em- 
ployed in some of the public land states in a similar manner. For 
example, Wisconsin provided that the income of the School Fund 
shall be applied exclusively to the following objects: (i) The sup- 
port and maintenance of common schools in each school district, 
and the purchase of suitable libraries and apparatus therefor; (2) 
the residue shall be appropriated to the support and maintenance 
of academies and normal schools and suitable libraries and appara- 
tus therefor.^^i 

The increase in the wages of teachers during the last half of the 
nineteenth century in New York, Massachusetts, Maine, Indiana, 
and Connecticut is shown by the following table: 

Table XXIV. Increase in Teachers' Wages in Typical States, 1847-1907 
Average Monthly Wage, Male and Female 



Year 




New York ^ ,<' 


Mass. ^ 


Maine ^, * 


IndJ 


Conn.^ 


183 1 
1S37 
1839 


Male 

Female 

Male 

Female 

Male 

Female 


$8.42 « 
12.00 « 


$25.48 
11.38 









« Male and female not reported separately. 
s Data taken from Table XXXI; see Index to Tables. 
* Not including board. 

?' Data taken from Table XLVII; see Index to Tables. 
«: Data taken from Table XXXIX; see Index to Tables. 
' Data taken from Table LVI; see Index to Tables. 
»« Data taken from Table XXVIII; see Index to Tables. 
480 Laws of Mass., 1854, Chap. 300, Sees. 2, 3. 

^1 Constitution of Wis., 1848, Art. X, Sec. 2; Hinsdale's Educational Documents, 
P- 1333- 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 
Table XXIV — continued 



193 



Year 




New York 0, " 


Mass. i 


Maine *, * 


IndJ 


ConnJ"' 


1845 


Male 
Female 


$10.00 « 


$32.11 '' 
7.50 « 








1847 '^ 


Male 


14.96 


24.51 


$15-40 


$12.00 


$16.00 




Female 


6.69 


8.07 


4.80 


6.00 


6.50 


1851 


Male 
Female 






16.66 
5-92 






1855 


Male 




43-05 ^'' 


20.57 


23.76 






Female 




18.52 ^0 


7.60 


16.84 




1865 


Male 


31.00 « 


54.77 


27.76 


31.00 


52.05 P 




Female 




21.82 


9.96 


20.50 


24.91 P 


187s 


Male 


50.78 « 


88.37 


36.96 


42.40 


71.48 




Female 




35-35 


17-36 


38.20 


36.67 


1885 


Male 


48.57 ' 


III. 23 


32.07 


44.60 


69.17 




Female 




43-97 


15.84 


36.80 


37-21 


189s 


Male 


53-00 « 


128.5s 


35-11 


47.60 ? 


85.87 




Female 




48.38 


24.04 


41.20 ? 


41.48 


1905 r 


Male 


83-56 « 


149.05 


38.22 


58.08 


108.34 




Female 




57-22 


29.48 


52.00 


47.66 



1847 « 


Mass. 


Penn. 


Conn. 


Maine 


N. Y. 


N.H. 


Mich. 


Ind. 


VI. 


Ohio 


Male 


$24.51 


$17.02 


$16.00 


$15.40 


$14.96 


$13.50 


$12.71 


$12.00 


$12.00 


$15.42 


Female 


8.07 


10.09 


6.50 


4.80 


6.69 


5-65 


S.36 


6.00 


4-75 


8.73 


1907 * 






















Male 


149.02 <^ 


54.49 


103.92 


39-98 


88.88 « 


52.63/ 


63.01 c 


60.80 


42.78 


45.00"^ 


Female 


57.07 c 


39-38 


45-83 


29.56 




35-21/ 


43-03*^ 


53-60 


30.45 


40.00** 



^ Data for 1847 taken from Eleventh Annual Report of Mass. Board of Educa- 
tion, 1847, PP- 96-97. 

* Report of U. S. Commissioner of Education, 1907, p. 556. 
' For 1905-06. '^ For 1902-03. 

^ Male and female not reported separately. 

f High School teachers' wages not included. 

» Data taken from Table XXXI; see Index to Tables. ^ Including board. 

* Not including board. 

'Data taken from Table XLVII; see Index to Tables. 

^ Data taken from Table XXXIX; see Index to Tables. 

' Data taken from Table LVI; see Index to Tables. 

*" Data taken from Table XXVIII; see Index to Tables. 

o For 1856. P For 1868. 

5 For 1893-94, Report U. S. Commissioner of Education, 1894-95, p. XLVI. 

^ Ibid., 1905, p. 409. 



194 PERMANENT COMMON SCHOOL FUNDS 

In New York, Maine, Massachusetts, and Indiana, schools were 
at first to a large extent, individual and isolated institutions. There 
Effects of were almost no standards of maintenance and 

Funds mTschoof^ procedure. State supervision was regarded in 
Organization many instances as state interference. As has been 

pointed out earlier in this chapter, efforts made in these states to 
secure reports from the towns upon which to base legislation or 
apportion public moneys were ineffectual. The first important 
result then upon school supervision and organization wrought by 
the permanent common school funds is to be seen in their influence 
upon school returns. 

Massachusetts, as early as 1826, had endeavored to secure 
returns from the towns concerning their schools. A law was passed 
Massachusetts' requiring each town to report to the Secretary 
toSTu^e^Sc^oof ^ of State on ten matters of school affairs as previ- 
Returns ously Stated in this chapter, but the law imposed 

no penalty for neglect and offered no reward for obedience. Out 
of a total of three hundred and five towns, two hundred and fourteen 
replied; twenty-one were silent. This interest, however, was only 
temporary, for five years later only eighty-six towns made returns. 
In 1832, looking forward to the establishing of the School Fund, a 
report of the Committee on Education upon this topic was printed 
in all the newspapers which publish the laws of the commonwealth. 
As a result of this extraordinary effort, ninety-six towns out of 
three hundred and five replied.^^^ 

The conditions in Maine were no better despite the fact that a 

large number of townships possessed township funds to aid in the 

support of their schools, and that the sources of 

Maine's Ineffectual . 1 i 1 • 1 

Efforts to Secure these funds in many mstances were lands which 
had been received originally from the state. In 
1827 an act was passed by the Maine legislature requiring the select- 
men of towns to make returns once in three years to the Secretary 
of State in four blanks furnished by him. The returns secured 
were so imperfect that no apportionment of school money was made 
on returns prior to 1833.^^^ In 1837 an act was passed providing 

*62 Me. School Report, 1901, pp. 48-49. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 



195 



for returns from town selectmen and plantation overseers to serve 
as a basis of distribution of the proceeds of bank taxes.^^^ The 
returns received proved so unreliable that the act was repealed 
in 1842. The first rehable school returns were received in 
1847, nineteen years after the establishment of the Permanent 
School Fund, and four years prior to the first distribution of its 
revenue.^^^ 

In New York, in 1815, the first year of the appropriation of the 
common school fund revenue, only four and one-half per cent of 
Influence of New the schools failed to make returns. Prior to this 
School F^^°on time it had been practically impossible to secure 
School Returns ^^y j-gtm-^s. Here as in Massachusetts the inter- 
est aroused by the prospect of the state permanent school fund was 
only temporary, for in 181 6 twenty-two per cent of the towns 
failed to send returns. The influence of the Common School 
Fund was soon evident, for after a second distribution of its 
revenue there was a rapid decrease in the number of districts 
failing to make returns. The following table shows the decrease 
in the number of towns failing to make returns in Maine, Massa- 
chusetts, and New York after the establishment of their respective 
state-controlled permanent common school funds: 



Table XXV. Submission of School Returns 

Increase in Three Typical States, Showing Influence of PubHc Permanent Com- 
mon School Fund 



New York "■ 



Massachusetts * 



Maine '^ 



Permanent common school 

fund created 
First annual distribution 

of revenue 



180S 
iSrs 



1834 
1835 



1828 
1851 



°- Data taken from Table XXXIV unless otherwise stated; see Index to Tables. 
* Data taken from Table XLV unless otherwise stated; see Index to Tables. 
•-" Data taken from Table XXXVIII unless otherwise stated; see Index to Tables. 
<«3 Ibid., pp. 52-53. 
<M Ibid., p. 60. 



196 PERMANENT COMMON SCHOOL FUNDS 

Table XXV — continued 





Number of Dis- 
tricts 


Number of Towns 


Number of Towns 






Noi 




Not 




Not 




Total 


Making 
Returns 


Total 


Making 
Returns 


Total 


Making 
Returns 


1815 














I8I6 


3J13 


840 . 










1820 


6,659 


327 










1825 


7,773 


656 


305 ' 


gi « 






183 s 


10,132 


456 


305 ^ 


7 ' 






I85I 


11,307" 


224 'i 


316 


I 


377 


16 


1865 








9 


406 


h 


187s 










421 


5 


1885 












k 



Influence of 
Returns Upon 
Common School 



The acquirement on the part of the state of the power to secure 
returns from the towns and districts meant much more than the 
securing of data upon which to base intelHgent 
^ „^„„„. legislation. It meant the establishment of inter- 
^y^*®'" course between local school authorities and state 

central authorities. It induced local authorities to recognize 
standards of education set up by the state. It meant the acceptance 
of state moneys and in many cases the fulfilling of conditions neces- 
sary for receiving state aid. It was the beginning of a state sys- 
tem of schools. The effect of the school funds on school organiza- 
tion and supervision is illustrated forcibly in the part they have 
played in bringing about the establishment of the ofl&ce of State 
Superintendent of Schools. 

It has been pointed out in a preceding paragraph that as early 
as 1827 Maine provided that the towns should make returns to the 
Influence of Secretary of State. By this provision the Secre- 

FunT^^Tn sfa'te""^ tary of State was given a limited and temporary 
Supervision supervision of schools. This appears to have 

been the beginning of the ofhce of State Superintendent of Schools 



<i For 1850. 
9 For 1862. 



e For 1826. 
^ None stated. 



/ For 1838-39. 

* Not reported since. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 197 

in Maine. The first state supervision of schools in Connecticut 
was by a board of commissioners of common schools composed 
of the Governor, the School Fund Commissioner and eight persons, 
one from each county, appointed by the Governor. This board 
was abolished in 1842. In 1845 the Commissioner of the School 
Fund was made ex officio the Superintendent of Common Schools 
and held this office until 1849.^^'' In Florida the Registrar of 
Public Lands was made Superintendent of Schools of the state in 
1849, the year following the creation of the State School Fund."*^^ 
Many of the public land states have provided for a board of edu- 
cation or a superintendent of schools in their constitutions which 
became effective upon their admission into the Union. Iowa, by 
constitution in 1846, provided that the common schools and the 
educational institutions of the state should be under the manage- 
ment of a board of education of which the lieutenant-governor 
should be the presiding officer.^''^ Michigan, in 1837,^^^ Wiscon- 
sin, in 1848,^^^ and Cahfornia in 1850,^'''^ each by constitution 
adopted in these respective years, provided for the office of Super- 
intendent of Public Instruction. It seems that it is not stating 
the matter too strongly to say that without the federal grants for 
common school funds such provisions for state supervision would 
have been indefinitely postponed. 

The local support of schools and the attitude of the towns and 
districts towards local school taxation have been previously de- 
Effects on scribed in this chapter and in Chapter II. It 
Local Taxation seems scarcely necessary to state again the fact 
that local school taxation had existed prior to the establishment of 
any permanent common school fund in Connecticut, New York, 
Massachusetts, and Maine as well as in such western states as 
Minnesota and in Arizona. Nevertheless, the school conditions 
in these states which have been outlined show clearly that although 

*85 Report Conn. Board of Education, 1876, pp. 1 19-120. 

468 Fla. Laws, 1848-49, Chap. 229, Sec. 2. 

*"''' Constitution of Iowa, 1846, Art. 9, Sec. i. 

** Constitution of Mich., 1837, Art. 10, Sec. i. 

«» Constitution of Wis., 1848, Art. 10, Sec. i. 

«o Constitution of Cal., 1850, Art. 9, Sec. i. 



198 PERMANENT COMMON SCHOOL FUNDS 

local taxes were levied for schools, the moneys were given grudg- 
ingly and under protest. The effect of the permanent common 
school funds on public sentiment concerning local school taxation 
is strikingly attested by the rapidly decreasing ratio of the total 
common school revenues derived from the income of the perma- 
nent common school funds. In Florida in 1870 approximately 
twenty-nine per cent of the local expenditure for public schools was 
derived from the income of the School Fund. In 1875 this source 
contributed only twelve and one-half per cent; in 1894, five and 
four-tenths per cent; in 1905, two and two-tenths per cent.* In 
Indiana, in 1866, only thirty-three and four-tenths per cent of the 
total common school revenue was derived from the local taxes. In 
1905 over seventy-three per cent (.7359) was derived from this 
source."*^^ 

The following tables j show the relation of the income of the 
pubhc permanent common school funds in Connecticut, New York, 
and Massachusetts to the total expenditure for schools and to school 
taxation: Table XXIX; Table XXXII; Table XL; Table LVIII. 

It would be difficult to estimate the influence which permanent 
common school funds have had upon the erection of suitable and 
Effect of sanitary school buildings. New York required 

Fuiid^"Tschooi°^ districts to erect school-houses and furnish them 
Buildings -with, fuel and necessary appendages.'*'^ This 

resulted in requiring the districts to raise money for these purposes 
by local taxation. North Carolina uses the income of her Literary 
Fund exclusively as a loan fund to districts to aid them in erecting 
school-houses. J Wisconsin loans a large portion of her School 
Fund to districts for building school-houses. Connecticut, as 
early as 1870, provided that no district should receive any public 
money unless it had a school-house and outbuildings satisfactory 
to the board of school visitors.^'^ In at least four states, Delaware, 

* Table XLII, see Index to Tables. 

t See Index to Tables. 

I See Account of North Carolina Literary Fund in Part II. 

471 Report U. S. Commissioner of Education, 1905, I, p. 411. 

472 Report N. Y. State Supt. of Public Instruction, 1833, pp. 12-13. 
*73 Report Conn. Board of Education, 1S76. 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 199 

Florida, New Jersey, and Virginia, school facilities and accommo- 
dations suitable and satisfactory from a sanitary standpoint must 
be furnished in order for the town or district to receive a portion 
of the revenue of the permanent common school fund. In New 
Jersey plans for school-houses must be submitted to the State Board 
of Education for criticisms and suggestions. Certain architectural 
requirements are specified by law.^^^ 

The public permanent comm.on school funds were the first stable 
source of support given to state systems of free schools in America. 
Miscellaneous Through the distribution of the income of the 

^^^'^^^ permanent school fund and the conditions attached 

to receiving it, schools have been maintained for a term of a definite 
length in many districts which otherwise would have been unwill- 
ing or unable to do so. Enough has been presented to show that 
the establishment of these systems was but the beginning of the 
great work accomplished. These funds have been wheel, ballast, 
and lever of our states' system of free schools. They set those 
systems in motion and kept them going. They maintained the 
equilibrium. They lifted them to higher and higher standards. 
The permanent common school fund has been the lever employed 
by many a state for raising the standards of educational oppor- 
tunities and facihties; for securing (i) the adoption of better courses 
of study; (2) enforcement of truancy laws; (3) libraries, apparatus 
and in some instances, free text-books; (4) transportation and 
tuition of pupils. It was owing to these funds that opportunities 
for education increased and became universal in the United States. 
The first permanent common school funds did not, it is true, make 
the schools free, but they supported public schools during a period 
of indifference and opposition. They continue to-day to be the 
source of revenue which supports the state supervision of schools 
and which serves as a means by which communication is estab- 
lished between every school district, however remote, and the State 
Department of Education. Through their influence the public 
school in the United States has arisen from a state of wretchedness 

47* N. J. School Laws, 1903, Sees. 129, 130. 



200 PERMANENT COMMON SCHOOL FUNDS 

and contempt until it now is recognized as one of the most impor- 
tant and respected of all public institutions. 

Of the Massachusetts School Fund it has been said : 

"It may, then, be claimed for the Massachusetts School Fund that the 
expectations of those by whom it was established have been realized; that it 
has given unity and efl&ciency to the school system; that it has secured correct 
and complete returns from all the towns; that it has, consequently, promoted 
a good understanding between the legislature and the people; that it has 
increased local taxation, but has never been a substitute for it; that it has 
enabled the legislature, at all times and in every condition of the general 
finances to act with freedom in regard to those agencies which are deemed 
essential to the prosperity of the common schools of the state." ^^^ 

Of the Indiana School Fund it may well be stated that from the 
admission of Indiana in 1816, during years of ignorance, illiteracy, 
and educational darkness, the Common School Fund stood as 
the only hostage of the pledges framed in the first constitution. 
During this period of a paper school system the Common School 
Fund kept alive the hope, the promise of and belief in a state 
system of public schools. . It was not until after the re-establishment 
of the Common School Fund by the new constitution of 1851 that 
the Common School Fund became really effective. It was this 
fund that sustained public schools and "gradually mollified and 
moulded public sentiment until a law permitting local taxation 
for all classes of school expenditures, a law at one time declared 
unconstitutional, was passed a second time and sustained by the 
supreme court that had declared it unconstitutional." Thus out 
of the work and influence of the Common School Fund of Indiana 
has grown her present effective system of school support by local 
taxation. 

It would be impossible to present even a most meager idea of the 
wonderful part the permanent common school funds have played 
in the public land states in providing and supporting free pubhc 
schools. To do so would be to write the history of common schools 
in these states. Certain states admitted into the Union at a time 
when rate bills were still employed elsewhere, provided in their 
constitutions for a complete system of free schools ranging from 
476 Boutwell, Geo. S., Report Mass. Board of Education, 1859, P- 5^' 



PURPOSE AND EFFECTS OF SCHOOL FUNDS 201 

elementary schools to a state university. The wages of teachers 
were placed on a sure basis. Frequently higher wages were paid 
than in the eastern states, thereby attracting to the West well- 
trained teachers. The office of school superintendent was pro- 
vided for and supported. In a few years many of these systems 
have developed to a degree of efficiency which has not been attained 
in some eastern states where free schools have existed for over a 
century. 

The history of permanent school funds bears ample witness to 
the power and need of a permanent school fund controlled by 
Conclusions. ^he State. Massachusetts, with the example of 

^^^^^ almost every one of the original states before her, 

took no measures for the establishment of a permanent school 
fund until 1834. It was only after Massachusetts was thoroughly 
convinced of the impossibility of organizing her schools into any 
efficient system that she established a permanent fund. Vermont 
estabhshed a permanent common school fund in 1825. Failure 
to appreciate this fund led to the loss of it. In 1904, nearly a 
century later, this state recognized her error and took steps which 
resulted in placing in the control of the state, funds previously 
intrusted to the towns, and in increasing this fund by nearly one- 
fourth of a million dollars. 

The records of loss and mismanagement of permanent com- 
mon school funds inevitably leads to the conclusion that an in- 
vestigation into the actual condition of the school funds and lands 
should be conducted without delay in nearly every state. The 
question by whom this investigation should be undertaken should 
be most carefully considered. The writer's own experience in a 
state in the far west leads him to believe that if possible a federal 
rather than a state investigation should be made in every case. All 
attempts to learn the actual conditions in that state from the land 
office were ignored. At length he was sent for by one of the officers 
of the state university who told him that the land commissioner 
who had in charge the sale of the university lands as well as the 
common school lands had notified the university that unless the 
writer discontinued his efforts to secure information concerning 



202 PERMANENT COMMON SCHOOL FUNDS 

school lands, the land commissioner would refuse to have further 
dealings with the university. At the Teachers' State Association 
a committee appointed for the sake of investigating the condition 
of the Common School Fund reported that, owing to the sensitive- 
ness of the land ofSce, they had been able to secure no information 
and moved that the investigation be dropped. This sensitiveness 
on the part of the land commissioner was stated to be the result 
of harassing inquiries with which he was continually beset. Accept- 
ing this explanation, it would seem that the public at large, and 
certainly that portion of the pubhc especially interested in the con- 
duct of its school affairs, should have easy access to the records of 
the school land office. 

A second conclusion to be reached as a result of this investigation 
is that township funds which are still maintained as independent 
funds should be made a part of the state fund. The excellent 
results of such a step have been clearly exemplified in the history of 
states where it has been done. 

It seems evident, also, that in those states where a credit fund 
has been substituted, in part or in whole, in place of a fund whose 
revenue was originally a real contribution and a relief from taxa- 
tion, some means should be taken to restore to the people the trust 
funds bequeathed by generations gone, and which have been di- 
verted or borrowed by a subsequent generation. In the first 
chapter it was shown that the present importance of these funds, 
even in states where they contribute a relatively small portion of 
the public school moneys, is greater than is frequently realized. 

Further, it appears that the method of apportioning the revenue 
of the permanent school fund calls for modification in a large 
majority of states. In the words of Professor Cubberley, "The 
state has been insistent in its demands and the burden of support 
is to-day greater than many communities can meet. With the 
maximum of taxation allowed by law they are unable to meet the 
minimum demands of the state." ^^^ The injustice of apportion- 
ing the income of the school funds according to school population 
has been realized by everyone who has made a study of its results. 

*^8 Cubberley, Elwood P., School Funds and Their Apportionment, p. 25. 



PURPOSE AND EFFECT OF SCHOOL FUNDS 203 

It is, to say the least, much to be regretted that the mode of appor- 
tionment adopted by Connecticut in 1820, should continue to be em- 
ployed by over thirty states under conditions almost totally different. 

The need of the appointment of an officer to be intrusted with 
the investment and management of the permanent common school 
fund, has been discussed in Chapter V. It is believed that the 
appointment of such ofl&cers would result in saving to these funds 
thousands of dollars annually beyond the expense of supporting 
such officers and assistants. Texas, where about two hundred 
and seventy-five thousand dollars ($275,000) was lost to the school 
fund in one year as the result of uncollected interest; ^^^ Wisconsin 
and Virginia, where thousands of dollars have been lost annually 
to the permanent school funds through failure to enforce laws 
relating to the collection of fines, — these states are examples of 
conditions which prevail, to a greater or less extent in other states 
and which might be remedied were one man appointed with salary 
and assistants sufiicient to enable him to see that the moneys 
devoted by law to increase the principal of the school fund were 
collected and added to it. 

Finally, the question may well be asked. Will not the time come 
when the creation of a federal permanent common school fund 
will be deemed desirable? Will not the vast difference in the 
principal and income of the permanent school funds possessed by 
different states result in inequalities of educational burdens and 
opportunities between states similar to inequalities which exist at 
present between townships of the same state? Is this condition 
not augured in the enormous prospective funds of several of the 
states, e. g., Texas, fifty-two million dollars; South Dakota, thirty- 
three million, North Dakota, twenty-eight million, Minnesota, 
one hundred and twenty-five million ? * Is not a federal fund 
even now desirable ? Would not such a fund result in raising the 
wages and qualification of teachers in states where these are com- 
paratively low ? Would it not hasten the establishment of national 
standards of education and unify our state systems ? 

* See foot-note 43, Chap. I. 

*'^ Report Texas Supt. of Public Instruction, 1899-1900, p. XLVII. 



PART II 

A SUMMARY OF THE ORIGIN, PRESENT CONDITION, 
AND ADMINISTRATION OF THE FUND IN EACH STATE 



CHAPTER VIII 

ALABAMA 



I. SIXTEENTH SECTION FUND — 2. VALUELESS SIXTEENTH SECTION 
FUND — 3. SCHOOL INDEMNITY LAND FUND — 4. SURPLUS REV- 
ENUE FUND 

The three titles, "Educational Fund," "School Fund," and 
"Public School Fund" are employed in the school laws and school 
'£HiQs. reports of Alabama to include school revenues 

Condition 1905 derived from taxation and permanent funds.^ Ala- 
bama reports four permanent common school funds with principal 
and income as follows for the year 1905.^ 

FxnsfDS 



Official Title 


Principal 


Interest or Income 


Sixteenth Section Fund 
School Indemnity Land Fund 
Valueless Sixteenth Section Fund 


$1,959,6233 
105,4953 

97,091 3 


$ii7>577^ 
6,3293 

5.8253 


Total 
Surplus Revenue Fund 


$2,162,209 * 
669,0863 


$129,731* 
26,7633 


Total 


$2,831,295 * 


$156,494 * 



It has seemed better to give the total fund excluding and then 
including the Surplus Revenue Fund in view of the fact that this 
fund, as explained in Part I of the present work, is, technically 
speaking, not a state permanent fund, but rather a loan from the 
United States made to the states in 1837. The total principal of 



p. 7; Turner, 



* Computed. 

1 Report State Supt. of Education, 1897-98, pp. 58-59; Ibid., li 
J. O., Public School Laws of the State of Ala., 1895, pp. 6-7. 
3 Data furnished, Jan. 8, 1907, by I. W. Hill, Ala. State Supt. of Education. 

207 



2o8 PERMANENT COMMON SCHOOL FUNDS 

permanent funds reported in 1903 was $2,135,313, yielding an 
income of $155,882^ (1904), approximately equal to twelve and 
forty-five hundredths per cent " of the common school revenue 
derived from all sources and to approximately nine and eight- 
tenths per cent * of $1,588,561,^ the total common school revenue 
in 1905. These figures represent nominal rather than actual 
values. The true condition of these funds cannot be positively 
stated, as questions sent to state officials have been either ignored 
or else returned unanswered, but it seems safe to say that in reality 
scarcely any permanent fund exists, except a small amount of six- 
teenth section school lands which yield but a slight and doubtful 
revenue. In 1882 the State Superintendent of Education wrote, 
"It is erroneously supposed by many that the interest accruing 
on the Sixteenth Sections, valueless Sixteenth Sections and the 
United States Surplus Revenue funds (are) the result of a prudent 
investment of the capital of these funds, ... in reality they have 
no existence except upon the books of the State. . . . The State 
became the trustee and her debt long since absorbed them." ^ 
Elsewhere we are told that the capital of the school land fund 
" may be theoretically placed in 1875 at $2,449,000." The $669,086 
surplus revenue was lost in the failure of the state bank in which 
it was deposited and " in 1848 it was considered doubtful whether 
the university and school funds and the surplus revenue would ever 
be realized as the bank had failed." The state recognizes the in- 
terest due on the surplus revenue at four per cent; also that due on 
the proceeds of public land sales at six per cent.''' The Vermont 
Special Commission on Permanent Common School Funds states 
(see report of the same, p. 5), ''that the six per cent interest on 
Sixteenth Section Lands and other land funds amounts to $160,000 
annually." 

Alabama originally was a part of the Mississippi Territory. 
June 16, 1802, the legislature of Georgia ratified articles of agree- 

* Computed. 

6 Ibid., LXXIV. 

8 Ibid., LXXV; Ibid., 1906, I, p. 306. 

"> Ibid., 1896-97, Chap. XII, p. 650. 



ALABAMA 209 

ment entered into April 24, 1802, by the Commissioners of Georgia 
and the United States by which Georgia ceded to the United 
States all right, title, and claim to her territory west 
of the Chattahoochee river.* March 3, 1803, 
Congress in an act regulating the disposal of the lands acquired 
from Georgia west of the Chattahoochee river, constituting the 
Mississippi Territory, reserved from sale section sixteen in each 
township for school purposes, and thirty-six sections, or one town- 
ship, for the use of Jefferson College. Alabama was admitted to 
the Union in 1819. Article VI of the first constitution of Alabama 
adopted December 14, 1819, provided that " the General Assembly 
shall take measures to preserve from unnecessary waste or damage 
such lands as are or hereafter may be granted by the United States 
for the use of schools within each township in this state, and apply 
the funds, which may be raised from such lands, in strict con- 
formity to the object of such grant." ^"'^ Provision for the estab- 
lishment of a permanent common school fund was not made until 
over eight years later. By an act approved January 15, 1828, 
Alabama set aside 901,725 ^ acres of sixteenth section lands granted 
by Congress, March 3, 1803.^° This was the first definite pro- 
vision made. Provision was made for the sale of these lands, the 
proceeds to be paid into the state treasury, the state becoming 
trustee and liable to pay to the districts and townships interest on 
the principal at the rate of six per cent.^ 

On December 16, 1836, Alabama accepted $669,089 from the 
federal Government, the state's share of United States Surplus 
Revenue, distributed in accordance with an act passed by Congress, 
June 23, 1836. The money was deposited in various banks and 
the interest used for a time to form part of the annual appropriation 
for supporting schools. It would appear that prior to 1854 the 
principal had been lost through bank failures or had been used for 

2 Laws, 1828, Chap. 26; Aikin's Ala. Digest, 1836, p. 379, Sec. 38. 

8 W. G. Clark, History of Education in Ala., U. S. Bureau Education, Circular 
of Information, 1889, No. 3, p. 218; Land Laws, Vol. I, pp. 588-591. 

9 State Grants of Public Lands, Mar. 12, 1896, p. 4, Tables General Land Office. 

10 Report U. S. Commissioner of Education, 1892-93, II, p. 1283. 
100 Ibid., p. 1321. 



2IO PERMANENT COMMON SCHOOL FUNDS 

state expenses. In 1854, however, it was declared to be a part of 
the educational fund and since that time the state has paid interest 
upon the total amount originally received. The interest is all 
derived from moneys raised by taxation and cannot be regarded as 
in any way income from surplus revenue deposit.^*^* 

Prior to 1854 the income from the interest on the proceeds of the 
sales of the sixteenth section lands was paid to the respective 
townships in which these lands lay. In 1854 an act was passed 
(approved by the Governor, Feb. 15, 1854), which provided for an 
"educational fund" to consist of (i) interest on the surplus revenue 
loan of 1836; (2) eight per cent on the proceeds of the sales of 
public lands granted in lieu of certain valueless school lands in 
1848; (3) six per cent on the proceeds of the sales of sixteenth 
section lands; (4) $100,000 paid by the state; (5) several minor 
appropriations.^" "^ 

The educational fund in 1855 ^^^ composed as follows: ^^^ 

Interest on the Sixteenth Section Fund (value of lands sold and pro- 
ceeds paid into the state treasury, $1,244,793.36) $ 74,687.60 

Interest on valueless Sixteenth Section Fund 7,767.30 

Interest on United States Deposit Fund 53,526.94 

Direct appropriation from treasury 100,000.00 

Special taxes 1,300.00 

Escheated property 233.55 

Total $237,515.39 

At the end of the year 1869 the state had diverted $187,872.^^ 
At the end of the year 1873 " the state had diverted $1,260,511. In 
1873 the total state apportionment for educational 
purposes was $522,810. The total amount actu- 
ally paid out of the state treasury, i. e., the amount not diverted, 
was $68,313." Every dollar of the educational fund, except the 
annual receipts from the sale of school lands, is now directly 
derived from the revenue of the state.^ Both the Sixteenth Section 

10& Bourne, E. G., History of the Surplus Revenue of iSj^, pp. 44-47. See also 
Part I, Chap. III. 
10 « Report State Supt. of Education, 1899-1900, I, p. 488. 
lod w. G. Clark, History of Education in Ala. (Cf. foot-note 8), p. 240. 
11 Report U. S. Commissioner of Education, 1874, p. 5. 



ALABAMA 211 

Fund and the Surplus Revenue Fund have been lost or misappro- 
priated. The interest which the state continues to pay on the 
lost Sixteenth Section and Surplus Revenue Funds really amounts 
to nothing more or less than paying a tax."« 

Many notes given for school lands, 1837 to 1874, inclusive, 

remained unpaid. In some cases the sixteenth section lands were 

surrendered to the townships, and have been occu- 

Causes of Loss , ^ 

pied and cultivated for years, without having ever 
been paid for. In both of these cases the loss was due to the lack 
of proper legislation.^^ The loss has frequently been due to the 
failure of properly recording the sale and title of the school lands. 
"Much of the time of this department is consumed in investigat- 
ing . . . records relating to the sixteenth section lands. Little 
evidence can be found regarding the sale of school lands. It is 
impossible to tell in many cases what sub-divisions were sold, be- 
cause trustees reported by lots instead of sub-divisions of sections, 
and frequently no date of purchase is recorded. Parties who 
claim to have purchased these lands before the war from the state 
or from those who originally purchased the same, are continually 
applying for patents, and in order to issue the same secondary 
evidence has to be relied on. "^^ 

The only present means by which the principal of the perma- 
nent school fund may be increased are the proceeds of sales of six- 
Present Sources teenth section lands remaining unsold after the 
of Increase (-j^jj ^^j. 14 ^he principal of the sixteenth sec- 

tion funds was increased, 1870-84, by $66,562 derived from the 
sales of sixteenth section lands.^^ 

The proceeds of sixteenth section lands are held in trust by the 
state, which pays to the district or township from which such 
proceeds were received six per cent interest on the money thus 
held in trust.^^ The state school revenue is distributed among 

ii<* Report Ala. State Supt. of Education, 1882, p. 7, taken from Bourne, E. G. 

12 Report State Supt. of Education, 1879, p. 9. 

13 Ibid., 1891, p. 7. 

" Report State Supt. of Education, 1884, p. 13. 
16 Ala. School Laws, 1895, Chap. 4, Sec. 1007. 



212 PERMANENT COMMON SCHOOL FUNDS 

the districts on the basis of school population, the school age 

being seven to twenty-one years.^^ The constitution provides 

that " not more than four per cent of all moneys 

Management, raised or appropriated for the support of public 

Present Basis rr r rr r 

of Apportionment, schools shall be expended otherwise than for 

Present Objects , i , . i i , i ^ n a 

teachers wages; provided that the General As- 
sembly may by two-thirds vote suspend the operation of this 
section." ^^ 

No conditions which need to be fulfilled by the districts in order 
to participate in the educational fund are stated in the School 
Present Conditions Laws compiled in 1895. When township or dis- 
for Participation ^j.j^^ trustees fail to make a return of the census 
enumeration required by law, the state superintendent is required 
to make the apportionment according to the returns last received.^^ 

16 Ibid., Sec. 1008, and Const., Art. XIII, Sec. i. 

17 Constitution, 1875, Art. XIII, Sec. 6; Turner, O. J., Public School Laws of 
the State of Ala., iSgj, p. 4. 

18 Turner, O. J., School Laws, iSgs, Sec. 1008. 



CHAPTER IX 

ALASKA 

In 1885 provision was made for the establishment of public 
schools in Alaska.^^ Alaska possesses no permanent common 
school fund nor has Congress ever set aside any school lands,^° 
but has made annual appropriations for the support of public 
schools as follows: 1886, $15,000; 1901, $30,000;^^ 1905? $50,000.^^ 

19 U. S. Bureau of Education, Circular of Information, 1887, No. 3, p. 194. 

20 Private letter received from E. E. Brovs^n, U. S. Commissioner of Education, 
Aug. 9, 1906. 

21 Report U. S. Commissioner of Education, 1902, II, p. 1237. (Gives table of 
appropriations, 1886-1901.) 

22 Statement of the U. S. Commissioner of Education for the year ending June 30, 
1905, pp. 16, 27, 32. 



213 



CHAPTER X 

ARIZONA 

On May 26, 1861, Congress reserved in each township of Ari- 
zona for the support of common schools sections numbered six- 
teen and thirty-six to be granted to Arizona whenever she shall 
become a state.^'' The estimated area of these lands amounts to 
4,050,347 acres.^" Arizona thus possesses the foundation of what 
promises to be some day a vast permanent common school fund. 
Congress made no provision for the sale of these school lands and 
none of them can be sold until Arizona becomes a state without 
some special provision by Congress.^^ Some school lands are 
rented, however, but the amount they contribute annually to the 
support of schools is relatively small, being $5,800.56'^ for the 
year 1905-06, approximately one and two-tenths per cent (.0118) t 
of $489,709.20,1 the total common school revenue derived as fol- 
lows r^'' 

Sources of School Revenue, 1905-1906 

Territorial taxes, $ 41,006.00 

County taxes, 255,237.92 

School (Poll) taxes, 74,818.78 

Gambhng licenses, 67,867.08 

Fines, forfeitures, 14,362.68 

Special taxes for maintaining schools, . 19,747.39 

Miscellaneous sources, 16,669.35 

Total, $489,709.20 



t Computed. 

23 Report U. S. Commissioner of Education, 1875, p. 468; Ibid., 18S6-87, p. 112. 
2* Data furnished Sept. i, 1906, by R. L. Long, Arizona Territorial Supt. 

214 



ARIZONA 215 

The terms territorial school fund and county school fund have 
been used from earliest times to denote the total sums raised for 
school purposes by taxes upon the territorial and several county 
treasuries.^^ The rate of county school tax differs in different 
counties. The rate of territorial school tax, 1905, was three cents 
on the hundred dollars.^'* 

26 Report U. S. Commissioner of Education, 1882-83, P* 283. 



CHAPTER XI 

ARKANSAS 
PERMANENT SCHOOL FUND 

Permanent School Fund ^^ is the official title of the Permanent 
Common School Fund of Arkansas. The term "common school 
rfjtie_ fund" is applied officially to a fluctuating sum 

Condition 1905 composed as follows: (i) interest on the Perma- 
nent School Fund; (2) ten per cent on the sales of all state lands; 
(3) future sales of sixteenth section lands; (4) two mill state school 
tax; (5) various small items. This amounts to nearly $500,000 
annually .^^ This is a loose use of the term "common school 
fund." The principal of the Permanent School Fund is chiefly 
" invested" in, or it would be better to say represented by, three per 
cent state bonds. "The state uses the money making it (the fund) 
practically a state debt." ^'^ The final payment of the bonds is 
"dependent upon the will of the state." ^^ In 1905 the principal 
of the Permanent School Fund amounted to $1,128,500.^^ The 
report of the United States Commissioner of Education (see 
report 1903, also 1905, p. 410) gives the income from the perma- 
nent fund as zero, an obvious error. The annual interest on the 
Permanent School Fund in 1905 was $32,855 ^'^ which is approxi- 
mately one and six-tenths per cent (.0160) * of $2,041,935,^^" the 
total annual common school revenue, excluding balances on hand 
and proceeds of bond sale.^'''* 

Upon her admission into the Union in 1836, Arkansas received 
from the United States the sixteenth section in each township, the 
same being granted for the use of common schools. The total 

* Computed. 

26 Report Ark. State Supt. of Public Instruction, 1899-1900, p. 28. 

27 Statement, Sept. 7, 1906, from J. H. Hinemon, Ark. State Supt. of Public 
Instruction. 

270 Report U. S. Commissioner of Education, 1905, I, p. /40. 

216 



ARKANSAS 217 

area of these sixteenth section lands amounted to 928,057 acres.^ 
No provision was made by the state's first constitution for the es- 
tablishment of a permanent fund from the proceeds 

Origin ^ ^ 

of the sales of these lands or from any other 
source, but on October 18, 1836, Arkansas accepted by terms of an 
act known as the "Ordinance and Acceptance Compact" proposi- 
tions offered by Congress on June 23, 1836, which devoted the 
sixteenth section lands to common schools^^ On February 3, 
1843, ^^ ^ct was passed providing for the sale of the sixteenth sec- 
tion lands, thus completing the provisions establishing the six- 
teenth section fund. 

As the result of the Act passed by Congress on June 23, 1836, 
providing for the distribution of the surplus revenue remaining 
in the treasury January i, 1837, Arkansas received from the 
federal government $286,751.48. The entire sum was used to 
furnish about one-half the capital of the Bank of the State of Arkan- 
sas. The law provided that the interest should be devoted to sup- 
port schools. But the law remained a dead letter and the principal 
was exhausted in general appropriations.^'^* 

The fund one time known officially as the Common School 
Fund 2^ was first established by constitution, 1868, article IX, sec- 
tion 4,^" supplemented by section I of an act passed July 23, 
1868, entitled "An Act to Establish and Maintain a System of 
Free Schools." The original capital consisted of 46,080 acres of 
land, "seventy-two sections originally granted by Congress for 
a state seminary of learning," but devoted by the legislature in 
1846 to the support of free schools.^^ It was further provided that 
the capital should consist of all lands that have been or may be 
granted by the United States to this state and not otherwise appro- 
priated, all moneys, stocks, bonds, lands and other property 
belonging to any fund for the purpose of education. The present 
Permanent (common) School Fund was established by an act 

276 Bourne, E. G., History of the Surplus Revenue of iS^y, pp. 47-50, 122. See 
also Part I, Chap. III. 

28 Report Ark. State Supt. of Public Instruction, 1S88, pp. 43, 44. 

29 Act Mar. 15, 1897; ^^k. Digest School Laws, 1905, p. 3. 

30 Report U. S. Commissioner of Education, 1892-93, II, p. 1361. 



2i8 PERMANENT COMMON SCHOOL FUNDS 

passed May 8, 1899, which provided that the Permanent School 
Fund should consist of all of the Arkansas six per cent bonds with 
the accrued interest thereon, both in the Permanent School Fund 
and in the Sixteenth Section Fund. "These were reissued in Ar- 
kansas three per cent bonds July i, 1899, all amounts in the treas- 
ury to the credit of the Sixteenth Section Fund have been trans- 
ferred to the Permanent School Fund.^^ The total fund thus cre- 
ated in 1899 amounted to $1,118,709.25 of which $1,113,500 was in 
bonds drawing three per cent annual interest and the remainder, 
$5,209.25, in currency .^^ On the one hand it would appear that this 
act practically merged the sixteenth section county funds and the state 
Common School Fund. On the other hand, the law provides that 
the net proceeds of sales of sixteenth section lands be forwarded to 
the State Treasurer " who shall place the amount to the credit of the 
county's sixteenth section fund to which it rightfully belongs." ^^ 

In the Common School Fund provided for by the constitution of 
1868 was included the state's share of the United States distri- 
bution of the surplus revenue of 1836, amount- 
ing to $286,751.49. But this sum was used up 
in general appropriations and so lost to the school fund.^^ One 
of the first causes of loss of the principal of the school fund was 
loaning the proceeds of school lands on insufiicient security. 
These proceeds, except those of sixteenth section lands, were 
intrusted to three county trustees, who received them from a 
county land commissioner. The trustees loaned these proceeds 
in many cases on worthless security. The claims of the state in 
the form of practically worthless notes and bonds for school lands 
amounted as early as 1870, to about three-quarters of a million 
doUars.^^ The second cause of loss of the school fund was the 
diversion of revenue which should have increased the principal 
of the Common School Fund. " After May, 1861, the state diverted 
from their proper purposes and used for general expenditures 
$7,260 of the Seminary Funds and $4,633 of the Saline Fund." ^^ 

31 Ark. School Laws, 1905, p. 76, Sec. 7703. 

32 Bourne, E. G., The History of the Surplus Revenue of 1837, p. 122. 

33 Report U. S. Commissioner of Education, 187 1, p. 73; Ibid., 1901, I, p. 393. 



ARKANSAS 219 

Insufficient legislation was the third cause. Act of December 7, 
1875, provided that ten per cent of the net proceeds of the sales 
of all state lands should be added to the principal of the Perma- 
nent School Fund, but failed to state who should have charge of 
it, whether the land commissioner or state treasurer. Probably 
through the neglect of this statute there was lost to the Common 
School Fund, 1875 to 1895, $50,000.^^ In the years 1874 and 1879 
something over $179,000 belonging to the permanent school fund 
was destroyed by fire.^^ " So complete (has) been the ruin of the orig- 
inal land grants to the nation, that in 1870 the permanent income 
from this source was but $35,192 while a careful administration of 
this patrimony would probably have yielded a state school fund of 
two or possibly three million dollars (with interest of $180,000)." ^^ 

The principal of the Permanent School Fund may be increased 
from seven sources: (i) the proceeds of all lands granted by the 
Present Sources United States not Otherwise appropriated. Arkan- 
of Increase g^g received 500,000 acres of lands for internal 

improvement, two or three million acres for reclaiming swamp 
lands and 50,000 acres of saline lands. None of these except the 
saline lands have been devoted to increasing the principal of the 
Permanent School Fund; ^^ (2) all moneys, stocks, bonds, lands and 
other property now belonging to any fund for the purpose of edu- 
cation; (3) the net proceeds of all sales of lands and other prop- 
erty escheating to the state; (4) the proceeds from sales of estrays; 
(5) proceeds of income dividends or shares in intestate estates; (6) 
ten per cent of the net proceeds of sales of all state lands; the fol- 
lowing when not otherwise appropriated: (7) grants; (8) gifts, (9) 
or devises.^^ 

The Permanent School Fund is managed by a Board of Commis- 
Present sioners consisting of the Secretary of State, the 

Management ^^^^^ Auditor, and the State Superintendent of 

Public Instruction.^'' 

3* Report Ark. State Supt. of Public Instruction, 1895-96, p. 171. 
35 Ibid., 1883-1884, p. 39. 

3' Report of the U. S. Commissioner of Education, 1901, I, p. 390. 
^ Ark. School Laws, 1905, p. 6, Sees. 749S, 7498. 



220 PERMANENT COMMON SCHOOL FUNDS 

The revenue of the Permanent School Fund is distributed by 
Present Basis of ^^^ ^^^^^^ Superintendent of Public Instruction to 
Apportiomnent ^j^g counties upon the basis of their school popu- 
lation.^^ 

The revenue of the Permanent School Fund is combined with the 

state school mill tax and various other revenues.^^ The objects 

to which this combined revenue may be applied 

Present Objects .^1,1 -r • 1 • 1 i 

are not specified by law. It is merely provided 
that "it shall be faithfully appropriated for maintaining a system 
of free schools for this state and (for) no other purpose whatever." 
It may not be used for building or purchasing a school-house,^^ 

" All school districts are entitled to a pro rata distribution of the 
Present Conditions Common School Fund whether they have a three 
for Participation months' school or not." 27 

38 Ibid., p. II, Sec. 7521. 

39 Ark. School Laws, 1901, Sec. 6936. 



CHAPTER XII 

CALIFORNIA 

STATE SCHOOL FUND 

The constitution and laws of California fail to provide specifi- 
cally a title for the permanent common school fund, but both in 
rf j^jg^ referring to it call it the State School Fund.^° The 

Condition 1906 g^^^g Treasurer and State Controller regularly 
apply this same term to " the total current annual school revenue 
derived from all sources." ^^ The term "fund" is employed 
officially by the State Department of Finance to designate a legally 
established division of moneys in the state treasury and not an 
invested sum of money .^^ The bond securities held by the State 
Treasurer constitute the invested portion of the school fund, and 
the moneys in the State School Land Fund are the portion await- 
ing investment. By adding the two amounts we ascertain the 
correct sum of the "perpetual fund" referred to in the constitution, 
the proceeds of which fund "shall be inviolably appropriated to 
the support of common schools throughout the State." ^^ There 
are at present (1906) in California, about 400,000 acres of unsold 
school lands which belong to the Perpetual School Fund, the pro- 
ceeds of the sale of which eventually will be added to the principal. 
The value of these lands cannot be estimated "but it is doubtful 
whether anyone would buy these lands as a whole at $1.25 per 
acre." ^ Almost all these lands are "in the mountains, inacces- 
sible, and of little value." '^^ In 1906 the total principal of the 
fund amounted to $5,263,834.42, of which $526,834.42 was unin- 

*" Cal. School Laws, 1903, employ this as title to Art. IX, Sec. 4, of the constitu- 
tion. See also Report State Supt. of Public Instruction, 1864-65, p. 249. 

^ Statement received from A. B. Nye, Cal. Controller, in letter dated Dec. 15, 
1906. 

*2 Ibid., letter Feb. 16, 1907. 

*3 Controller Report, 1905-06, p. 24. 

** Answers given in question are by A. B. Nye, Dec. 15, 1906. 

221 



222 PERMANENT COMMON SCHOOL FUNDS 

vested, the remaining $4,737,000 was invested in state, county, 
and municipal bonds. Of this, $1,526,500 invested in six per cent 
State Funded Debt Bonds of 1873, is a debt owed by the state to 
itself, on which the state pays the interest out of state taxes."*^ As 
a result, this portion of the Perpetual School Fund, instead of 
decreasing the burden of the state tax, actually makes it heavier. 
Moreover, $500,000 of the principal has been transferred to another 
fund for the purpose of erecting a state building in San Francisco. 
This sum is an indefinite loan on which the state pays four per 
cent. The annual income of the Perpetual School Fund for the 
year 1906 amounted to $250,570.87,*^ which is approximately six 
per cent (.06) * of $4,142,914.50,'^^ the total receipts for common 
schools that year.f 

By the first constitution which California adopted and which 
became effective upon her admission into the Union, 1850, pro- 
vision was made for a permanent or perpetual 
common school fund, whose interest should be 
devoted to the support of common schools.^ The nucleus of this 
fund as provided for by the constitution of 1850 was 500,000 acres 
of land granted by act of Congress in 1841.'*^ At the same time 
5,610,702 acres ^ of sixteenth and thirty-sixth section lands were 
to a slight extent sources of school revenue, but these lands were 
at first regarded as belonging to the townships, and not until 1861 
were they made a part of the State Perpetual School Fund.^^ 
Prior to the consolidation of the sixteenth and thirty-sixth sec- 
tion township funds with the state fund, the towns 
sold some 50,000 acres of these lands, which, es- 
timated at $2.00 per acre should have added to the school fund 
$100,000, but this money has never been heard of.'*^ The report 

* Computed. 

t The report of the United States Commissioner of Education for 1905, p. 410, 
gives the total school revenue as $9,270,859. This amount may include sums 
not devoted to common schools or else the amount given by the controller is in- 
correct. 

45 Cal. Constitution, Art. IX, Sec. 2. 

48 U. S. Statutes at Large, Vol. V, p. 455, Chap. 16, Sees. 8, 9. 

47 Cal. State Supt. of Public Instruction Report, 1864-65, p. 249. 

48 Ibid., p. 241, 



CALIFORNIA 223 

of the Superintendent of Public Instruction for 1858 estimates that 
of the 5,525,760 acres to which the schools are entitled by law, only 
114,880 acres had survived loss or diversion, "to such pigmy pro- 
portions has our magnificent domain dwindled." ^* If we estimate 
the 7,219,324 acres originally set aside for common schools at $1.25 
per acre, a low estimate, it would give a capital of $9,024,155. 
Comparing this with the present capital, we see that the lowest esti- 
mate of the loss would be over $6,000,000 and with proper manage- 
ment the fund would have without doubt yielded $20,000,000. 

The constitution provides five sources from which the principal 
of the State School Fund may be increased: proceeds of (i) the 
Sources of unsold portions of the 500,000 acres of land 

Increase granted by Congress, 1841; (2) sales of sixteenth 

and thirty-sixth section lands; (3) intestate estates; (4) rental of un- 
sold school lands; (5) such per cent (five) as may be or has been 
granted by Congress on the sale of public lands lying within the 
state.^^ An act of Congress approved June 27, 1906, provided that 
California should receive payment of five per cent of the proceeds 
of public land sales extending over a score of years. "The exact 
amount involved is not yet known, but it is believed that it will 
approach one million dollars, and the entire sum, under the require- 
ments of our Constitution must be added to the permanent fund 
which is invested for the support of the common schools. Within 
two months after the approval of the act warrants amounting to 
$428,271.61 had been drawn to the credit of the state.^^*^ Upon 
the completion of the payment there should be a perpetual fund 
of over $6,00000.^^* 

The State Controller keeps a separate account of the School 
Fund and of its revenue, and twice a year reports it to the Super- 
Present intendent of Public Instruction. The Controller 
Management draws his warrant on the State Treasurer, which 
must be indorsed by the Superintendent of Public Instruction.^" 

*8Cal. Constitution, 1879, Art. IX, Sec. 4. 
490 Controller's Report, 1905-06, pp. 28-29. 
«» Ibid., p. 24. 
*• Cal. School Laws, 1901, Sec. 435. 



224 PERMANENT COMMON SCHOOL FUNDS 

The revenue is apportioned by the Superintendent of Public 
Instruction among the several counties upon the basis of school 
population, but according to a somewhat complex 
ppor lonm n method of procedure. The State Superintendent 
of Public Instruction "shall apportion to every county and to 
every city and county two hundred fifty dollars ($250.00) for every 
teacher determined and assigned to it on school census by the 
county or city and county school superintendent for the next pre- 
ceding school year, as required by the county or city and county 
school superintendent by the provisions of section 1858 of this 
code, and after thus apportioning two hundred fifty dollars on 
teacher or census basis he shall apportion the balance of the state 
school fund to the several counties or cities and counties according 
to their average daily attendance as shown by the report of the 
county or city and county school superintendents for the next 
preceding school year." ^^' ^^" The county or city and county 
superintendent estimates the number of teachers in each district by 
calculating one for every district having seventy or less than sev- 
enty census children (five to seventeen years) and one additional 
teacher for every additional seventy children or fraction of seventy 
not less than twenty. "And in cities or districts wherein separate 
classes are established for the instruction of the deaf ... an addi- 
tional teacher for each nine deaf children, or fraction of such num- 
ber not less than five, actually attending such classes (children in 
asylums and not attending public schools cannot be counted in 
making the estimate of the number of teachers to which the dis- 
trict in which asylum is located is entitled); the county superin- 
tendent must then report the number of teachers thus estimated 
to the Superintendent of Public Instruction." 

The total county and state school revenue derived from all 
sources is apportioned as follows : $500 is apportioned to every dis- 
trict for every teacher so allowed to it, except that to districts hav- 
ing over seventy or a multiple of seventy school census children 

51 Ibid., 1903, p. 102, Sec. 1858. 

5io Laws Cal., Chap. 185, Mar. 18, 1905, amending Sec. 1532, Political Code, 
1903; E. C. Elliot, Bu. Ed., Bulletin No. 3, 1906, p. 47. 



CALIFORNIA 225 

and a fraction of less than twenty census children there shall be 
apportioned $25.00 for each census child in said fraction. "All 
school moneys remaining on hand after apportioning to the dis- 
tricts the moneys provided for in subdivision three of this section, 
must be apportioned to the several districts in proportion to the 
average daily attendance in each district during the preceding school 
year." (Here follows special mode of estimating average daily at- 
tendance for newly formed school districts.) " Census children . . . 
shall be construed to mean those between the ages of five and 
seventeen years." ^^* 

All state school moneys, except the ten per cent reserved (in 
rural districts) for school library purposes, must be applied exclu- 
sively to the payment of teachers of primary and 

Objects , 1 rr., ,-, r ^ . , , 

grammar schools. The library fund m rural dis- 
tricts consists of not less than five nor more than ten per cent of 
the county school fund annually apportioned to the districts.^^ 

In order to share in the revenue of the State School Fund, a dis- 
Present Conditions trict must maintain for not less than six months a 
for Participation ^^^i'^ g^j^^^l ^^^^^^ ^^ ^ tcachcr holding a legal 

certificate.^^ 

51* Laws Cal., Chap. 64, Mar. 6, 1905, amending Sec. 1858, Political Code, 
1903, pp. 46-47; E. C. Elliot, Bu. Ed., Bulletin No. 3, 1906. 

52 Cal. School Laws, 1903, p. 83, Sec. 1713. 

53 Ibid., p. 104, Sees. 1859, 1S60. 



CHAPTER XIII 

COLORADO 

PUBLIC SCHOOL FUND * 

The permanent common school fund of Colorado, officially 
known as the Public School Fund ^'^ consists (January i, 1906) of 
Title. $1,408,322.50; the annual revenue of which added 

Condition 1906 tQ ^jjg j-gjji- Qjj unsold school lands belonging to 

this fund amounts to $220,896.44, which is approximately four 
and ninety-seven hundredths per cent (.0497) of $4,438,030, the 
total common school revenue derived from all sources.^^* The 
invested fund represents not more than one-twelfth of the prospec- 
tive capital: — 1,568,530.42 acres of unleased land of an estimated 
value of $5,487,856.47 and 1,993,041.40 acres of leased land with 
an estimated value of $9,965,207 to make a total of $15,453,063.47 
to be added to the present capital. The total invested and esti- 
mated capital ($1,408,322.50 plus $15,453,063.47) amounts to 
$16,861,385.97. 

Upon her admission into the Union, Colorado received from the 
United States for the support of common schools the sixteenth and 
thirty-sixth sections in each township, amounting 
in all to 3,650,000 acres.^^ The first constitution, 
adopted August i, 1876, upon her admission as a state, and which 
has remained unchanged, provided that "The Public School Fund 
of the state shall consist of the proceeds of such lands as have 

* For this account I am indebted to Katherine L. Craig, State Supt. of Public 
Instruction of Colorado, who is authority for all data unless otherwise stated. 

^ Colo. Constitution, 1876, Art. IX, Sees. 3, 5; Report U. S. Commissioner of 
Education, 1S92-93, II, p. 1383. 

64a Report U. S. Commissioner of Education, 1906, I, p. 306. 

55 The U. S. General Land Office (for reference see note 9) makes this 3,7iS,555, 
but this is evidently an estimate, not an exact measurement. In many cases the 
acreage reported in these tables is too large; 3,650,000 acres is the area invariably 
given in Colorado reports (see Report State Supt. of Public Instruction, 1901-02, 
p. 18). Superintendent Craig wrote 3,561,572, but this is the present total unsold 
acreage. 

226 



COLORADO 227 

heretofore or may hereafter be granted to the state by the general 
government for educational purposes." ^'^ 

Four hundred eighty-eight thousand, six hundred thirty-three 
dollars and forty-four cents of the School Fund derived from the 
sale of school lands was invested in the so-called 
"excess warrants" of 1887, 1888, and 1889, which, 
with interest, would now (1906) amount to over $1,000,000, Since 
that time the state has redeemed about $25,000 of these warrants, 
and the investment without interest now represents v$463,765.77. 
The state has twice repudiated this indebtedness, and the warrants 
cannot be paid until some time in the future when a constitutional 
amendment shall be adopted. 

The constitution of 1876 in the section already referred to, pro- 
vided five possible sources of increasing the principal:^'* (i) All 
Sources of estates escheating to the state; (2) all grants. 

Increase ^^-j gj£|.g^ qj. ^^^ devises made to the state for edu- 

cational purposes; (5) proceeds of all lands granted to the state 
for educational purposes by the United States. The only sources 
that have actually contributed anything up to the present time are 
the proceeds of the sales of sixteenth and thirty-sixth section lands. 

The State Treasurer is the custodian of this fund.^^ The revenue 
is apportioned by the Superintendent of Public Instruction among 
Management. the counties on the basis of the total school popu- 

Apportionment j^^j^j^ ^^^^ ^^ twenty-one years) .5« 

The Public School Fund revenue must be used for the main- 
tenance of the schools of the state.^^ The law permits its use for 
all objects of school expenditure except erecting, 
repairing, and furnishing school-houses and the 
purchasing of school lots.^' 

This of course leaves the greater part of it for teachers' wages. 

The only requirement which a school district must fulfil in order 

Requisitions for ^o receive its quota of the Public School Fund 

articipation revenue is that it maintain a public school for at 

least three months during the school year.^^ 

8* Colo. School Laws, 1897, p. 16, Sec. 11. 

" Ibid., p. 57, Sec. 71. 58 ibid., 1900, Sec. 75. 



CHAPTER XIV 
HISTORY OF THE SCHOOL FUND OF CONNECTICUT 

No state permanent school fund has a more interesting history 
or is more worthy of study than that of Connecticut. Peculiar 
interest must always be attached to this fund in 
view of the fact that Connecticut was the first 
state to establish a permanent state fund for the benefit of common 
schools. New York had taken the first step towards the estab- 
lishment of her Literary Fund in 1786, but this fund was devoted 
to secondary not elementary schools, and it was not until 1805 
that she established her Common School Fund. Maine did not 
create her Permanent School Fund until 1828; New Hampshire 
her Common School Fund until 1867, Massachusetts her School 
Fund until 1834. Furthermore, Connecticut began distributing the 
income from her School Fund in 1799 whereas the first distribution 
of New York's Common School Fund was not made until 1815. 
By the Ordinance of 1785 and the resulting contracts of sale of 
public lands made in 1787, the federal Government had reserved 
for schools in its western lands one section out of every thirty-six, 
yet it was years before any permanent funds were established from 
the proceeds of these reservations. Those who established the 
Connecticut School Fund planned that its income would be suffi- 
cient to support the common schools of the state. From 1821 to 
1854, all taxation for schools was practically discontinued. The 
result was a decline of the school system as soon as the School 
Fund began to contribute its revenue. The experience for which 
Connecticut paid dearly, guided and warned others, at the same 
time that her example inspired them. 

The Connecticut permanent common school fund, officially 
known as the School Fund,^" consists in 1905 of a permanent 

S9 Conn. Constitution, Art. VIII, Sec. 2. 
228 



CONNECTICUT 229 

invested inviolable principal of $2,022,502.23,*'" yielding an annual 
revenue of $109,579.*" In 1902 approximately three and two- 
Titie. tenths per cent (.032) *^ of $3,443,944, the total 

Condition 1905 g^^te public school revenue, was derived from the 
income of the School Fund. 

The charter of Connecticut given by Charles II, King of England, 
in 1662, "conveyed to the 'Governour and Company of the Eng- 
connecticut School l^sh Collony of Connecticut, in New England in 
Fund Origin* America' " land which included parts of Rhode 
Island, New York, New Jersey, and all west of New Jersey be- 
tween north latitude 41° and 42° and 2' to the Pacific Ocean.^^'^ 
Original Extent By Virtue of this charter, Connecticut in 1663-64 
ciaiSeTS ^^""^^ claimed jurisdiction over the towns of Wickford, 
Conn., 1662 Rhode Island, and Westchester, New York, to 

the Hudson river, and most of Long Island, but these claims were 
soon given up, and the Pawcatuck river was agreed upon with 
Rhode Island as a boundary line. The parts 

Claims in New r xt 1 i 

York and Hew of Ncw York and New Jersey included by the 

Jersey Ceded , r ^ ^ 1 ^ 1 • ■, 

charter of 1662 had been previously granted 
under Plymouth Charter, 1620, and therefore could not be claimed 
by Connecticut. All lands west of the Delaware river had 
never been granted to any one, and therefore belonged to Con- 
necticut. 

In 1 681 Charles II gave to William Perm the charter of Pennsyl- 
vania, covering the present state of Pennsylvania. The northern 
part of this had been already given to Connecticut. Connecticut 
asserted her claim to this land. " Settlers from Windham County, 
Conn., began to migrate to the Wyoming Valley while the French 
and Indian War was in progress, but permanent settlements were 
not effected until about 1769. These operations were conducted 
principally under the auspices of the Susquehanna Company, 

* For an account of the sources from which moneys for schools were derived 
prior to the creation of the School Fund and for a description of the evolution of 
policy which brought about the creation of this fund consult Chapter II. 

*> Conn. School Fund Commissioner's Report, 1905, pp. 12-13. 

'^ Report Conn. Board of Education, 1903, p. 47. 

'i« Report Conn. Board of Education, 1S76, p. 108. 



230 PERMANENT COMMON SCHOOL FUNDS 

which was at first a private affair, but was afterwards incorporated 
and protected by the State." ^^* 

From 1774 to 1782, "the settlers on the Susquehanna sent their 
representatives to the Connecticut legislature, received ofl&cers 
Connecticut's appointed by that body, established schools and 

^ven "to Penn- P^-id taxcs precisely like other citizens in Connecti- 
syivania, 1782 ^^^,^ 61 c j^ j^gs a Court of Commissioners ap- 
pointed by Congress to arbitrate the Connecticut-Pennsylvania 
land case rendered the following decision: "We are unanimously 
of opinion, that the state of Connecticut has no right to the 
lands in controversy. We are also unanimously of opinion, 
that the jurisdiction and pre-emption of all the territory lying 
within the charter boundary of Pennsylvania, and now claimed 
by the state of Connecticut, do of right belong to the state of 
Pennsylvania." ^^'^ 

Connecticut still owned the land west of Pennsylvania, a narrow 
strip seventy miles wide but extending through forty-four degrees 
of longitude or nearly one-eighth of the circumference of the earth. 
But in May, 1786, acting upon the repeated suggestions of Congress 
to the colonies owning western lands, the General Assembly of 
Connecticut authorized her delegates in Congress, "or any two 
of them to convey to the United States all (of Connecticut's) lands 
lying west a line parallel to and 120 miles distant from the western 
line of the State of Pennsylvania." ^^"^ 

Connecticut reserved for her own use the lands lying between 
,. ^ the western boundary line of Pennsylvania and 

Connecticut •' •' 

Reserves for the Ceded territory. The area of the section of 

Herself Western 

Reserve.— Area of land thus reserved was about three million three 

"W^cstBni Rcscirvc 

hundred thousand acres.^^ It was known vari- 
ously as the "Western Reserve," "Connecticut Western Reserve," 
and " New Connecticut." ^^ ' It lay in what is now the northeastern 

81* Hinsdale, B. A., Documents Illustrative of Educational History, Report U. S. 
Commissioner of Education, 1892-93, p. 1265. 

61 c Report Conn. Board of Education, 1876, p. 108. 
6i<* Journals of Congress, VIII, pp. 83-84. 
61/ Report Conn. Board of Education, 1876, p. 106. 
63 Report Conn. Board of Education, 1853, p. 69. 



^ - ' ; CONNECTIC^^' 231 

corner of Ohio and was bounded on the north by the niternational 
boundary (Lake Erie); on the east by Pennsylvania; on the south 
by parallel 41° north latitude; on the west by a line parallel to the 
western boundary of Pennsylvania and one hundred and twenty 
miles from it.^^^ 

In October, 1786, an act was passed authorizing the sale of a 
Efforts to Sell portion of this land, with the result that 24,000 

Connecticut Reserve j^(,j.gS ^gj.g ^^i^ ^^ Qg^. S. H. ParsonS-^^s By 

the conditions of this act, 500 acres of good land were given in 

every town five miles square to the public for 

Acres, 1786. the support of the gospel ministry, t;oo acres 

Ministerial and 1 r 1 i 

School for the support of schools, and 240 acres in fee 

Reservations . , ^ r 1 • • 

simple to the first gospel minister who should 
settle in the town.^^* This reserving of township lands for 
schools and the ministry was not without precedent in Con- 
necticut. 

In 1792 Connecticut made her second disposition of Western 
Reserve lands; 500,000 acres of land now lying chiefly in the 

counties of Erie and Huron, Ohio, were given to 

Second Disposi- ... ... t ^ 

tion of Western the Citizens of eight enumerated Connecticut 

RcsCfX^C 1*702 

towns, who had suffered loss from the depreda- 
tions of the British during the Revolution.^^ ^ 

In 1793 the General Assembly appointed a committee of 

First Effort to eight persons whom it empowered to sell the 

nent State remainder of the Western Reserve on certain 

«n ' ^^^^ specified terms.® ^'* The act passed in 1793 reads 

as follows: 

"An Act establishing funds for the support of the ministry and schools of 
education. 

"1 « Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report U. S. Commisssioner of Education, 1892-93, p. 1256. 

6i(? Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report U. S. Commissioner of Education, 1892-93, p. 1257; citation taken from 
Hist. Coll. Mahoning Valley, Vol. I, pp. 149-151. 

01^ Id. 

81* Report Conn. Board of Education, 1876, p. 109. 



232 PERMANENT COMMON SCHOOL FUNDS 

"Be it enacted, etc., That the monies arising from the sale of the territory 
belonging to this State, lying west of the State of Pennsylvania, be, and the 
same is hereby, established a perpetual fund, the interest 
whereof is granted and shall be appropriated to the use 
and benefit of the several ecclesiastical societies, churches, or congregations 
of all denominations in this State, to be by them applied to the support of their 
respective ministers or preachers of the gospel and schools of education, under 
such rules and regulations as shall be adopted by this or some future session 
of the general assembly." 

"This act was not passed without strong opposition in the 
assembly. Its passage led at once to a widespread, spirited, 
A t Att k d ^^^ even acrimonious discussion, in which the 

press, the pulpit, the platform, the town meet- 
ing, and the legislature all participated." *^^^ 

All controversy over the Act of 1793 was closed by an act passed 

by the Connecticut General Assembly May, 

Created by Act 170=;, entitled, "An Act appropriating the monies 

of the General '"•^' ' . ff f f 

Assembly of which shall arise from the sale of Western 

lands, belonging to this State." It reads as 
follows:**^* 

"Be it enacted by the Governor and Council attd House of Representatives, 
in General Court assembled, That the Principal Sum, which shall be received 
Principal Sum *^^ ^he sale of the lands belonging to this State lying West 

to Remain a of Pennsylvania, shall be, and remain a Perpetual Fund, 

Perpetual Fund r , t^ , r ■ ^ ■ , ■ ^ 

for the Support lor the Purposes hereatter mentioned m this Act, to be 

of Schools loaned or otherwise improved for such Purposes as the 

General Assembly shall direct; and the interest arising therefrom shall be 
and hereby is appropriated to the Support of Schools in the several Societies 
constituted, or which may be constituted by Law, within certain Local Bounds, 
within this State, to be kept according to the Provisions of Law, which shall 
from Time to Time be made, and to no other Use or Purpose, whatsoever, 
except in the Case, and under the Circumstances hereafter mentioned in 
this Act." 

2. "Be it further enacted. That the said Interest as it shall become Due 

61 J Hinsdale, B. A., Documents Illustrative of American Educational History, 
Report U. S. Commissioner of Education, 1892-93, pp. 1257-59. 

61* Quoted from Hudson and Goodwin, Digest of Acts and Laws of Conn., 1805, 
PP- 31-33- 



CONNECTICUT 233 

from Time to Time, shall be paid over to the said Societies, in their Capacity 
Interest When of School Societies, according to the List of Polls and 
Paid Over to Ratable Estate of such Societies respectively; who shall. 

School Societies when such Payment shall be made, have been last per- 
fected." 

3. "Provided nevertheless, and he it further enacted, That whenever such 
Society shall, pursuant to a vote of such Society, passed in a legal Meeting 
It May Be Ap- named for that Purpose only, in which Vote two-thirds of 
o/Ministry^^°'^ the legal voters present in such Meeting shall concur, 
and Churches apply to the General Assembly requesting Liberty to im- 
prove their Proportion of said Interest, or any Part thereof, for the Support 
of the Christian Ministry or the Public Worship of God, the General Assembly 
shall have full Power to grant such request during their Pleasure; and in case 
of any such grant, the School Society shall pay over the Amount so granted, 
to the Religious Societies, Churches or Congregations of all Denominations 
of Christians within its Limits, to be proportioned to such Societies, Churches 
or Congregations, according to the List of their respective Inhabitants or 
Members, who shall, when such Payment shall from Time to Time be made, 
have been last perfected; and in Case there shall be in such School Societies 
any Individuals composing a Part only of any such Religious Society, Church 
or Congregation, then the Proportion for such Individuals shall be paid to the 
Order of the Body to which they belong, by the rule aforesaid, and the monies 
for such individuals shall be discounted from their Ministerial Taxes, or 
Contributions, and in that way inure to their exclusive Benefit, and the Monies 
so paid over, shall be applied to the Purposes of the Grant, and to no other 
whatsoever."* 

4. "Be it further enacted. That if any Society, Church or Congregation shall 
apply any of the aforesaid Monies to any other Use or Purpose than those to 
To Be Forfeited which they shall or may have a right to apply them pursuant 
if Misapplied ^q ^l^jg ^d-^ such Society, Church or Congregation, shall 
forfeit and pay a Sum equal to that so misapplied, to the public Treasury of 
this State." 

5. "Be it further enacted, That all Inhabitants living within the Limits of 
School Meetings the located Societies, who by Law have or may have a right 

to Be Holden m |-q Vote in Town Meetings, shall meet some time in the 

October Annually " 

in the Located Month of October annually, m the way and manner pre- 

Societies scribed in the Statute, entitled 'An Act for forming, order- 

ing and Regulating Societies' and being so met shall exercise the Power given 
in and by said Act, in organizing themselves, and in appointing the necessary 

* Towns were permitted to levy a general tax "on their several inhabitants 
according to their respective list" for the support of the ministry, pp. 315-319, 
Conn. Digest, 1805. 



234 PERMANENT COMMON SCHOOL FUNDS 

Ofi&cers, as therein directed for the Year ensuing; and may transact any other 
Business on the Subject of SchooHng in general, and touching the monies 
hereby appropriated to their use, in particular according to Law; and shall 
have power to adjourn from Time to Time as they shall think proper." 

6. ^'Be it further enacted, That the Inhabitants or Members of the several 
Religious Societies, Churches or Congregations aforesaid, who have right by 
^ . -_ . Law to Vote in their respective Meetings, on the Subject 
in December of the Ministry and the Public Worship of God, shall 
Annually assemble themselves some time in the Month of December 
annually, or at such other time as they shall judge convenient, and may organize 
themselves and appoint the necessary Officers, as in said Act is directed, 'all 
in the way and manner therein prescribed, with Power to adjourn from Time 
to Time as they may think proper; and in any of their said Meetings they shall 
have Power to transact any Business relating to the Ministry and the Public 
Worship of God, according to Law; but shall have no Power to Act on the 
Subject of Schooling; any Law, Usage, or Custom to the contrary notwith- 
standing.' " 

7. "Be it further enacted, That an act passed October, 1793, entitled, 'An 
Act for the establishing a fund for the support of the gospel ministry and 
schools of education' be, and the same is hereby, repealed." 

The three provisions of this act which most concern us may be 
summarized as follows: 

I. The principal arising from the sale of western lands to 
remain a perpetual fund, its interest to be appropriated to the 
support of schools in the several school societies. 
■ 2. The interest to be paid over to the said societies, in their 
capacity of school societies, according to the last perfected list of 
polls and ratable estate of such societies respectively. 

3. Any society by a two-thirds vote could apply to the General 
Assembly to expend all or any part of its share of the School Fund 
revenue for the support of the Gospel ministry, and the Assembly 
could grant such permission. 

"Managers of the funds arising in the sales of the Western 

Reserve" were appointed. The report of the managers presented 

to the legislature October, 1800, showed that the 

Management 6U *= , . r 

condition of the fund was very unsatisfactory. 
"A large amount of interest was unpaid and the collateral 

61' Hinsdale, B. A., The Common School Fund 0/ Conn. Report U. S. Commis- 
sioner of Education, 1892-93, p. 1260. 



CONNECTICUT 235 

securities of the original debts were not safe."^^' Upon a 
recommendation of a committee of the legislature it was de- 
cided to put the fund in the care of one man, and in 18 10, Hon. 
Jas. H. Hillhouse, for sixteen years a United States senator, 
was appointed " Commissioner of the School Fund." This 
office has continued from that time until the present. Mr. Hill- 
house immediately resigned his position in the senate and entered 
upon the duties of his new office. He found that the capital 
consisted chiefly of the debts due from the original purchasers of 
the Western Reserve and the substituted securities which had been 
accepted in their stead. These securities had in the course of 
fifteen years, by death, insolvency, and otherwise, become involved 
in complicated difficulties. The interest had fallen greatly in 
arrears, and in many cases nearly equaled the principal. The 
debtors were dispersed in different states. Without a single liti- 
gated suit, or a dollar paid for counsel, he reduced the disordered 
management to an efficient system, disentangled its affairs from 
loose and embarrassed connections with personal securities and 
indebted estates, rendered it productive of a large, regular, and 
increasing dividend, and converted its doubtful claims into well- 
secured and solid capital. During the fifteen years of his adminis- 
tration the annual dividend averaged $52,061.35, and the capital was 
augmented to $1,719,434.24. The amount of the interest that he 
divided was $780,920.24, which, added to the sum of $456,757.44, 
previously divided, made an aggregate of $1,237,677.68. The 
policy thus inaugurated by Mr. Hillhouse was continued by his 
successor, Hon. Seth P. Beers, who was appointed commissioner 
in 1825, and held the office till May, 1849, when he resigned. 
During his administration, by judicious sales and management of 
lands which came into his possession as forfeited securities, the cap- 
ital of the fund was increased from $1,719,434.24 to $2,049,482.32; 
and the income from $72,418.30 to $133,366.50, being an average 
of $97,815.15 per annum. From 1849 to 1859 there were six dif- 
ferent commissioners, but no change followed in the manage- 
ment or prosperity of the fund — the productive capital of which, 
according to the report of Hon. Albert Sedgwick, dated April 16, 



236 PERMANENT COMMON SCHOOL FUNDS 

1859, amounted to $2,043,372.01, yielding an income for the year 
of $142,303.42, or $1.30 for the benefit of each child in the 
state between the ages of four and sixteen. The entire income 
of the fund from 1799 to 1859 amounted to $4,940,988.29, besides 
paying the expense of its management. "We know not in the 
whole history of public funds or trust estates," says Dr. Barnard, 
" another instance so creditable to the economy, fidelity, and prac- 
tical judgment of the persons intrusted with its management for a 
period of sixty years." 

The early changes in the custodianship of the School Fund 
bear witness to the recognition of the fact that it suffered severely 
from mismanagement made during the first 
years of its history.^'* As stated in the preced- 
ing paragraph, Hon. Jas. Hillhouse, appointed in 1810 the first 
Commissioner of the School Fund, found that the capital of 
the fund consisted chiefly of debts due from the original pur- 
chasers of the Western Reserve and the substituted securities 
which had been acepted in lieu of them. The debtors had scattered 
and were in different states, nevertheless Mr. Hillhouse succeeded 
in placing the fund in qxcellent condition. In 1820 the principal 
was reported to be $1,858,074.33; ""^ in 1825, $1,719,434.24:^" 
amount lost, $138,640.09. Since 1828 the principal has gone on 
increasing gradually but steadily, and the management appears 
to have been not only above reproach, but eminently judicious.'^'* 
No sources for increasing the principal of the 

J^ggrig of IllCrC3.SC tjj J. J. 

School Fund are provided at present, other than 
wise investment. 
The revenue of the School Fund is apportioned (1896) by the 
State Controller among the towns upon the basis 

Apportionment 

of their school population ^^ (4-16 years). 
Teachers' wages are the only legitimate object to which towns 
may apply their quota of the income of the School 
^'^^'^'^ Fund.«« 

64 Report Conn. Board of Education, 1876, p. in; Report U. S. Commissioner 
of Education, 1892-93, p. 1260. 

^ Conn. School Laws, 1896, p. 69, Sec. 182. 
66 Ibid., Sees. 48, 182. 



CONNECTICUT 237 

For participation in the school fund revenue, five conditions 
must be fulfilled: ^^ (i) returns must be previously submitted;*"^" 
Requisitions for (2) ^ public school must have been maintained 
Participation £qj. ^^^ jggg ^lyg^Yi thirty-six wceks during the year ; ^^ * 

(3) all moneys drawn from the public treasury must have been ex- 
pended for teachers' wages only; ^^'^ (4) the school must be taught 
by a duly examined and approved teacher; ^^^ (5) schools must be 
visited according to law.^^ *= 

Connecticut Town Deposit Fund 

Connecticut received $764,670.60 ^^ of the United States Surplus 
Revenue of 1837. In 1837 $763,661.83 '^^ was deposited by Con- 
necticut with the towns to be loaned by them and became known as 
the Town Deposit Fund. Until 1855 three-fourths, and since 
1855 the whole of the income of this fund was devoted to aid com- 
mon schools.^^ The principal was reported in 1902 and 1905 ^^^ 
to be $754,972.34,^^ a decrease of $8,698.26. The interest of 
the Town Deposit Fund for 1902 was $28,086.35,^^ but "in 
most cases this interest exists on paper only and is not a sub- 
stantial contribution to the support of schools." '^^ Connecticut 
possesses many local permanent school funds, the aggregate prin- 
cipal of which in 1905 amounted to $282,451.03,^^° but these 
funds are entirely outside the scope of this present work. 

**<^ Conn. Common School Laws, 1892, Chap. 12, Sec. 162. 

686 Ibid., 1896, Sees. 48, 182. 

68« Foot-notes 66« and 66*. 

87 Bourne, Edward G., History of the Surplus Revenue of 1837, PP- 5°) 122. 

87o Statement received Sept. 12, 1906, from Chas. D. Hine, Secretary Connecticut 
State Board of Education. 

**s Report Conn. Board of Education, 1903, p. 43. The same principal of the 
Town Deposit Fund is reported for 1905 as for 1902; it is safe to assume that the 
interest for the two years is the same. 



CHAPTER XV 

DELAWARE 
PUBLIC SCHOOL FUND 

The permanent common school fund of Delaware, oJB&cially 
known as the Public School Fund ^^ has (1905-06) an invested prin- 
cipal of $938,097 ™ yielding an annual revenue 
Condition, of $54,303,^^ which is approximately ten and nine- 

tenths per cent of $498,524, the total common 
school revenue for 19057^'' Of the principal, $759,312 are invested 
in bank stock,''^ and the remainder, $178,850,^^ in state bonds 
which are practically a permanent state debt upon which the state 
pays interest at six per cent7^ Formerly this fund was known by 
the title of the School Fund,'''^ but the term school fund is used 
to-day to include annual appropriations by the legislature for schools 
as well as the income of the Public School Fund7^ 

The Public School Fund was established by an act of legislature 
passed February 9, 1796. This act provided, "That the money 
paid into the State Treasury on account of mar- 
' riage and tavern licenses between February 9, 

1796, and January i, 1806, be and is hereafter to be applied under 
the direction of the Legislature, for establishing schools in the state." 
The money thus accruing was directed to be put into shares of 
the Bank of Delaware, United States Bank, Pennsylvania Bank, or 

69 Constitution of Del., Art. X, Sec. 2; Hughes, J. H., School Laws for the Free 
Public Schools of Delaware, 1898, p. 3. 
™ Del. Treasurer's Report, 1905, p. 20. 

71 Ibid., p. 23. 

''i'^ Report U. S. Commissioner of Education, 1906, I, pp. 306-307. 

72 Del. Treasurer's Report, 1905, p. 27. 

73 Ibid., pp. 6, 8, and personal letter, Nov. 28, 1906, from Thos. N. Rawlins, 
Treasurer. 

74 Report U. S. Commissioner of Education, 1885-86, p. 71. 

75 Hughes, School Law, 1898, p. 38, Sec. 27. See footnote 6g. 

238 



DELAWARE 239 

the North American Bank. "Subsequently the same (act) was 
modified by putting the residue arising from the sale of licenses, 
after paying the salaries of the judges and Chancellor, into the 
School Fund. A supplement was passed in 1806 to continue in 
full force the modified Act of 1796 until January i, 1820." '^^ 
Boone states that "no definite results came of" the legislation of 
1796, and that "the present fund dates from 1837."" On the 
contrary, I find that by 181 7 the School Fund had increased to 
an amount sufficient to permit the legislature to appropriate from 
its income, February, 181 7, $1,000 to each of the three counties 
of the state,'^ and in 1829 the principal amounted to $158,160,157* 
After 1829 the interest of this fund was annually distributed to 
the free schools of the state.^* 

Delaware accepted, January 16, 1837, $286,751.49 as her 
share of the United States Surplus Revenue distributed in 1837.'^^ 
This was invested by the state in much the same securities as 
those in which the principal of the Public School Fund had been 
invested. It was subsequently enacted that the revenue of this 
Surplus Revenue Fund should be equally divided among the 
three counties for the aid of free schools,^^ thus making it by 
investment and use practically a part of the Public School Fund. 

Delaware, in the matter of preserving her Public School Fund, 
presents a bright contrast with many of the states. No accessible 
record bears evidence that any of the principal 
has been either diverted or lost, with the excep- 
tion noted above of the early diverting of a portion of the income 
to pay the salaries of the judges and the Chancellor. Bourne 
estimates in 1885 the value of the securities Delaware purchased 
with her share of the Surplus Revenue Fund as $337,708,''^ show- 
ing a gain of $50,959. If to the amount of Surplus Revenue 

78 Report Del. Supt. Free Schools, 1880, p. 45. 

77 Boone, Education in United States, p. 86. 

78 U. S. Bureau of Education, Circular of Information, No. 3, 1893, p. 161. 
Report U. S. Commissioner of Education, 1895-96, I, p. 280, places the principal 
at $151, 643 with annual income of $9,255. 

79 Bourne, Edward G., History of the Surplus Revenue of 1837, pp. 52-53. See 
also Part I, Chap. III. 



240 PERMANENT COMMON SCHOOL FUNDS 

received we add $158,160, the value of the principal in 1829 " 
prior to the receipt of the Surplus Revenue, we get a total of 
$444,911, which subtracted from $938,097,'^*^ the value of the prin- 
cipal, 1905, gives $493,186 * as the total increase over the amount 
originally invested. 

No sources are provided at present for increasing the principal 
of the Public School Fund. The proceeds of about nineteen 
Present Sources different kinds of licenses at one time dedicated 
of Increase ^^ ^j^g School Fund were later added annually to 

the revenue of the Public School Fund.'^'-''' To-day the revenue 
from such hcenses, amounting in 1901 to $559.25,^^ are placed to 
the credit of the general fund '^^'^ out of which the legislature pays 
the expenses of the state, including (1901) $120,000,^^ (iQOS)? 
$132,000,'^ annual appropriation for free schools and special school 
appropriations.*'' The annual state free public school appropria- 
tion in 1905 was $132,000.'^^ 

The State Treasurer is, by virtue of and dur- 

Management . . 

mg the continuance of his office, the Trustee of 

the School Fund.«2 
The revenue of the Public School Fund is apportioned by the 

State Treasurer upon the following twofold basis: First, the rev- 
enue of the total fund, except $300 annual six per 

Apportionment . ,* i / 

cent mterest on a Sussex county $5,000 bond, is 
divided into three equal shares for the three counties of the state, 
New Castle, Kent, and Sussex. In addition to its third of the Pub- 
lic School Fund revenue, Sussex receives the above $300 interest. 
Second, the revenue falling to each county is again divided equally 
according to the number of districts in each county, among all 
districts, white and colored.*^ 
The Constitution (Art. X, Sec. 2) permits the revenue of the 

* Computed. 

79<J U. S. Bureau of Education, Circular of Information, No. 3, 1893, p. 
161. 

80 Report Del. Supt. Free Schools, 1901, p. 74. 

81 Ibid., Cf. pp. 7, 128. 

82 Del. School Laws, 1898, p. 38, Sec. 27. 

83 Report U. S. Commissioner of Education, 1S85-86, p. 70, foot-note 81. 



DELAWARE 241 

Public School Fund to be used "for the payment of teachers' 

salaries and for furnishing free text-books." The 
Objects ^ _, • p 1 1 p 

State Treasurer may use it for the purchase of 
free text-books; ^^ the districts for teachers' wages and for no other 
purposes.*^ 

A district must meet two classes of requisitions in order to receive 
its share of the School Fund.^^ First, it must maintain a school- 
Requisitions for house satisfactory to the county school commis- 
Participation sioners from a sanitary standpoint; second, it must 

raise a local tax of a fixed amount. Every white district in New 
Castle county or Kent county must raise by subscription or taxation 
$100 in order to receive its share of the School Fund; every white 
district in Sussex county, $60; every colored district in Newcastle 
or Kent counties, $50; in Sussex county, $30.^^ 

84 Hughes, School Law, 1898, p. 30, Sec. 22J. 

85 Ibid., p. 39, Sec. 27. 

88 Ibid., p. 9, Sec. 4; p. 41, Sec. 27. 



CHAPTER XVI 

DISTRICT OF COLUMBIA 

The District of Columbia possesses no district permanent com- 
mon school fund. In 1826 the City of Washington provided for 
investing as a permanent fund $40,000 raised by lotteries (1812- 
26). The purpose of the first lottery, November, 1812, had been 
to establish two public schools upon the Lancaster system. By 
the legislation of 1826 this fund was diverted from its orignal 
purpose and "appropriated, solemnly pledged and set apart for 
the purpose of encouraging two charity schools, one in the eastern 
section and the other in the western section of the city." *^ " Con- 
gress has turned over from time to time single lots or buildings or 
authorized the sale of certain lots, the proceeds to be applied to the 
school funds, but there has never been a permanent school fund in 
the District of Columbia derived from the sale of public land," ^^ 

87 Barnard, Special Report, pp. 25-76, issued by U. S. Dept. of Education, re- 
printed Barnard, American Journal, Vol. 19, 1869, pp. 49-77. 

88 Extract from personal letter, Sept. 21, 1906, from A. T. Stuart, Director of 
Intermediate Instruction, Washington, D. C. 



24a 



CHAPTER XVII 

FLORIDA 

STATE SCHOOL FUND 

The permanent common school fund of Florida, formerly entitled 
School Fund or Common School Fund, now officially known as 
Titie_ the State School Fund,^^ consisted in 1905 of 

Condition, 1905 $1^085,367, invested chiefly in state and United 
States bonds ^° and of 114,085 acres of unsold common school 
lands ^° valued at ($3.00 per acre) $342,255. Adding these two 
amounts we get for the estimated prospective value of the fund, 
$1,427,622. In 1905 the total common school revenue of the state, 
derived from all sources, amounted to $1,473,191.80.^° The portion 
of this actually derived from the interest on the State School Fund 
was $33, 632,^*^ approximately two and three-tenths per cent (.0228*) 
of the total common school revenue. The state makes annual 
appropriations "for payment of interest on state bonds, held by 
the educational funds of the state as permanent investments." 
In 1905 this appropriation amounted to only $18,047.01 ^°'^ 

"In December, 1835, while Florida was still a territory, 'the 
register of the land office was charged with the duty of selecting 
and securing the various lands granted by Con- 
gress for schools, seminaries and other purposes.' 
By act of March 2, 1839, three school trustees were ordered to be 
chosen in each township. Each was to have the care of the six- 
teeoth section lands in his township, lease the same, and apply 
the rents or profits for the benefit of the common schools." ^^ 

* Computed. 

89 Fla. Constitution, 1885, Art. XII, Sees. 4, 5. 

9" Statement received Feb. 24, 1907, from W. M. HoIIoway, State Supt. Public 
Instruction of Florida. 
80" Laws 1905, June 5, Chap. 5477. 
83 U. S. Bureau of Education, Circular of Information, No. 7, 1888, p. 20, note 2. 

243 



244 PERMANENT COMMON SCHOOL FUNDS 

Florida received 1,053,653 acres of sixteenth section lands ^ 
from Congress upon her admission as a state, March 3, 1845.^^ 
The first constitution adopted that same date provided in very- 
general terms for the establishment of a permanent school fund.^^ 
The care of the sixteenth section lands and the establishing of the 
funds was intrusted to the townships, it being originally expected 
that these lands should form the basis of local town funds. 

From 1839 to 1850 many acts were passed regarding the fund, but 
the results of these were so slight that they do not call for a consid- 
eration in a summary statement. " It was not the original inten- 
tion that the sixteenth section lands should be sold and merged into 
a common fund; but rather that by rental, or interest on the purchase 
money, if sold, such section should confer its benefits upon the town- 
ship alone to which it belonged. ... But as far as can be learned 
only one township ever organized to get the benefit of the act.^^ 

" The legislature therefore directed that the lands be sold and the 
fund consolidated," i. e., placed under state control.^"* The indiffer- 
ence of the towns and their failure to establish such funds led the 
legislature to enact in 1848^"* that the land be sold by the Register 
of Public Lands, and the proceeds paid into the State Treasury 
for the establishment of a permanent state common school fund.^^ 

It has been impossible thus far to learn what the value of the 

principal of the State School Fimd was in i860. In that year, 

however, Florida gave her school and seminarv 

Loss '=' 

funds to the governor in exchange for certificates 
of the indebtedness of the state to each fund.^^ The result was 
that Florida expended the cash principal of her Common School 
Fund for arms, ammunition, and other objects, and at the close 
of the Civil War the only portion of the School Fund remaining was 
about 600,000 acres of unsold school land.^^ 

91 Report U. S. Commissioner of Education, 1S92-93, II, p. 12S3, Table Land 
Grants. 

92 Fla. Constitution, 1S45, Art. X. 

94 Laws of Fla., 1S4S, p. 34, Chap. 230, approved Dec. 28, 1S48. 

95 Resolution No. 4, Laws of Fla., 1S60-61. 

96 Sheats, Wm. N., Digest of the School Laws of Fla., 1S97, Sees. 13, 15; Con- 
stitution of Fla., Art. XII, Sec. 4, amended 1894. 



FLORIDA 245 

At present (1897) five sources for increasing the principal of 
the State School Fund are provided by law:''^ (i) The proceeds 
Present Sources ^^ ^^^ lands that have been or may hereafter be 
of Increase granted to the state by the United States for 

public school purposes; (2) donations to the state when the purpose 
is not specified; (3) state appropriations; (4) proceeds of escheated 
property; (5) twenty-five per cent of the sales of public lands which 
are now or may hereafter be owned by the state. 

The State School Fund is managed by the State Board of Edu- 
cation.^^ The revenue is apportioned by the State Superintendent 
Management and o^ Public Instruction "among the several counties 
Apportionment ^f ^^^ g^^^g. ^^^^ ^^^ ^^^^^ ^f average attendance 

therein of children of school age " (six to twenty-one).^'' 

The law does not specify the objects to which the income of the 
State School Fund may be applied. The joint income of the State 
Objects of School Fund, the one mill tax, and the county 

Application ^qY[ tax apportioned to a county, constitute the 

county school fund.'^^ The necessary expenses of maintaining the 
schools in any county during any year shall constitute the first 
claim against the school fund of that year, but the income of the 
county school fund may be used to purchase real estate or to erect 
school buildings.^^ 

(i) In order to avoid forfeiting its share of the state public school 
revenue, a county or district must maintain such school or schools 
Requisitions for ^^ the available funds will support and must com- 
Participation plete its proper term of school before the terminus 

of the school year; ^°° (2) county schools failing to hold full session 
must make up such lost time within the next school year or forfeit 
their apportionment; ^°°" (3) aid will not be granted to any school 
(high school or rural graded school) until the County Board shall 
have appropriated for such school an amount which will, with the 
state aid applied for, maintain the school for eight months or 

9^ Ibid., Sec. 33, Rev. Stats., Sec. 133. 
"8 Constitution of Fla., Art. XII, Sec. 9. 

99 Sheats, Wm. N., Digest of the School Laws of Fla., 1S99, P- 4^) Sec. 116. 

100 Sheats, Wm. N., Digest of the School Laws of Fla., 1899, p. 42, Sees. 119, 120, 
100a Laws of Fla., 1905, May 31, Chap. 5386. 



^46 PERMANENT COMMON SCHOOL FUNDS 

longer; ^°°* state aid will be granted to no (high or rural graded) 
school (4) making an average attendance of less than fifty pupils; 
(5) unless the building in which the school is taught is owned by 
school authorities in fee simple and contains at least two good 
recitation rooms; (6) after July i, 1904, unless every teacher therein 
holds a legal and unexpired certificate issued in Florida; that of the 
principal of a high school must be of such a grade as to show that 
he himself is qualified to teach any subject in the Standard Course 
of Study; that of a principal of a rural graded school shall be at 
least a first grade certificate,^"''* 

1006 Regulations of the State Board of Education regarding high schools and 
rural graded schools; Florida State Supt. of Public Instruction, Report, 1904, 
Appendix C, pp. 231, 233. 



CHAPTER XVIII 
GEORGIA 

Georgia has at present no permanent common school fund.^°^ 
The term common school fund is applied to the total state public 
Title. Present school revenue derived from fourteen different 
Condition sources/°^ namely: (i) direct tax levy; (2) poll 

tax; (3) half rental of Western & Atlantic R. R.; (4) liquor tax; 
(5) net hire of convicts; net fees for inspection (6) of fertihzers, 
(7) of oils; (8) show taxes; (9) dividends of Georgia R. R. stock; 
(10) rental of oyster lands; (11) dividends from state bank stock; 
(12) gifts, endowments, devises, and bequests to the State Board 
of Education; (13) commutation tax for military service; (14) 
animal tax.^*^^ It is sometimes erroneously stated that Georgia 
has a permanent common school fund composed of "half the 
Western & Atlantic R. R., and some stock of the Georgia R. R." 
(Report U. S. Commissioner of Education, 1902, I, xcii), but the 
above items numbered 3, 9, 10, and 11 do not constitute a perma- 
nent school fund, i. e., the law does not set them apart as per- 
manent or inviolable sources, the revenue of which shall never 
be appropriated for any purpose other than schools. In the year 
1900-01, of all the invested sources, items 3 and 9 alone contrib- 
uted to the common school fund,^°^ the former $210,006,^°' and the 
latter $2,046,^"^ making a total of $212,052. This would represent 
the interest on a principal of $3,534,200 at six per cent. The 
total public school revenue for 1901 was $2,011,753,^°^ of which 
accordingly approximately ten and five-tenths per cent (.1054*) ^°* 

* Computed. 

101 Letter received from W. B. Merritt, Ga. School Commissioner, Jan. 4, 1905. 

102 Ga. School Commissioner's Report, 1903, p. 404, also School Law, 1903, 
Sec. 38. 

103 Report Ga. Controller, General 1901, p. 39. 

M* Report U. S. Commissioner of Education, 1901, I, Ixxxvii. 

847 



248 PERMANENT COMMON SCHOOL FUNDS 

was derived from invested state capital, but not from permanent 
invested funds. The following table shows the sources and the 
amount derived from each for the year 1905: 

1. Direct levy (appropriated for 1905) $1,000,000.00 

2. Poll Tax, including insolvent polls 274,657.00 

3. Half Rental W. & A. R. R 210,006.00 

4. Liquor Ta.x 170,000.00 

5. Hire of Convicts (to April I, 1904) 45,000.00 

6. Net Fees from Fertilizers 25,550.00 

7. Net Fees from Inspection of Oil 4,100.00 

8. Show Tax 4,295.00 

9. Dividends from Stocks Ga. R. R 2,046.00 

10. Lease of Oyster Lands 140.00 

Total $1,735,704.00 

Section 54 of the constitution of 1777 provided that free schools 
should be erected in each county and supported at the expense of 
_ . . the state. As early as 1783 the Governor of 

Permanent Geor2;ia was empowered to grant one thousand 

Common School ^ ^ ° 

Fund Estab- acres of land for the establishment of free schools 

lished 1817 . , ^,.r r^ r 1 1 

m each county .^"-^ Grants of land were given to 
academies, many of which were actually established, but nothing 
further was done for free schools after 1783 until 1817.^°^' ^*^' 
In that year, 181 7, Georgia provided for a permanent common 
school fund by an Act passed December 18, which "set apart and 
appropriated for the future establishment and support of free 
schools throughout the state" $250,000, and directed the governor 
" so soon as a favorable opportunity may occur, to invest the above 
sum in bank or other profitable stock." '^^^ The following are 
some of the sources which contributed to the growth of the fund 
thus established; in 181 8 by the Land Lottery Act, lots Nos. 10 

105 Watkin's Digest of Laivs of Ga., p. 15; U. S. Bureau of Education, Circular 
of Information No. 4, 1888, p. 17. 

106 Prince's (1836) Digest of Laivs of Ga., p. 18; see also U. S. Bureau of Educa- 
tion, Circular of Information, 1888, II, 24-34. 

107 "We have no evidence that this legislation vfz.5 carried out," Common School 
System of Georgia, by O. A. Thaxton, Columbia U. M, A. Thesis, 1904 (unpub- 
lished), p. 19. 



GEORGIA 249 

and 100 in each surveyor's district were set apart and reserved for 
the benefit of schools/"^ and by subsequent legislation their pro- 
ceeds were made a part of the Permanent School Fund. An Act 
passed December 21, 1821, provided for the permanent investment 
of the fund, already accumulated, and of $500,000 added by this 
act.'*'^ It bestowed upon the total fund the title "School Fund," 
and drew a distinction between the Free School and the Academy 
Funds by providing that the interest on one-half of the $500,000 
added by this act should be applied to the permanent endowment 
of county academies, and the revenue of the other half should be 
applied to the encouragement of free schools. This distinction 
led the latter fund to be spoken of generally as the Poor School 
Fund. By an act passed December 23, 1836, Georgia set apart 
"as a permanent free school and education fund" $350,000,^°^ one- 
third of her share of the United States Surplus Revenue distributed 
in 1837.* In 1840 all state appropriations were merged in a Free 
School Fund.i«^' ''" 

The total Free School Fund in 1840 may be roughly estimated 
as follows: appropriation 1817, $250,000; appropriation, 182 1, 
$500,000; Surplus Revenue, 1837, $350,000; total 
(not including proceeds of land grants of 181 8), 
$1,100,000. The annual revenue of this fund in 1836, amounted 
to $40,000,^^° but owing to the stigma of the badge of pauperism 
attached to receiving it, it was rejected with contempt.^^^ It seems 
probable that little, if any, of the interest on the Surplus Revenue 
was ever used for supporting schools. It appears to have been 
paid out for general state expenses.^^^ In 1845 only fifty-three out 
of ninety-three counties applied for their share.^^" The total dis- 
tribution, 1817-^60 (forty-three years) amounted to $1,290,000,"° 
or an average of $30,000 annually. Up to i860 the revenue was 

* See Part I, Chapter III. 

^"8 Prince's Digest of the Laws of Georgia (1836), p. ig. 

109 United States Bureau of Education, Circular of Information No. 4, 1888, 
p. 26. 

1^0 Ibid., p. 27, also Report U. S. Commissioner of Education, 1895-96, I, 
295- 

112 E. G. Bourne, History of the Surplus Revenue of 1837, pp. 56, 59, 122. 



250 PERMANENT COMMON SCHOOL FUNDS 

therefore often rejected, and oftentimes diverted from its legitimate 
use. All permanent common school funds were lost during the 
Civil War, 1860-65.1^1 

m O. A. Thaxton's unpublished Report on School Funds in Georgia, given in 
Seminary^ History of Education, Columbia University, 1903-04; U. S. Bureau of 
Education, Circular of Information, 1888, No. 5, II, p. 26; Report U. S. Commis- 
sioner of Education, 1875, p. 72. 



CHAPTER XIX 

IDAHO 

PUBLIC SCHOOL FUND * 

The permanent common school fund of Idaho, officially known 
as the Public School Fund/^^ consisted in 1903 of an invested 
Titie_ principal of $1,241,968/^'* and of unsold school 

Condition, 1903 land worth about $10,000,000, estimated as fol- 
lows: 57,584 acres of leased lands estimated at $575,840,^^^ and 
942,416 acres of unleased lands estimated at $9,424,160,"^ mak- 
ing a total estimated prospective fund of over eleven million dollars 
($11,241,968). It is estimated that the state up to the present 
time has borrowed about $500,000 from the principal of the Public 
School Fund.^^^ This is secured by four per cent state bonds and 
six per cent state warrants, the interest on which is paid chiejfly 
out of state taxes.^^^ These bonds and warrants are dependent 
for their credit and final payment upon the will of the state. They 
are not negotiable.^^^ The principal is invested chiefly in state 
bonds and warrants, school district, county and municipal bonds 
and first mortgage farm loans at one-third their appraised value. ^^'''^ 
In 1902, $67,615, or approximately ten and two-tenths per cent 
(.102) ^^^ of Idaho's total public school revenue was derived from 
the income of the Public School Fund."^ 

* The title used in the treasurer's report is General School Fund. The manage- 
ment of this fund is entirely with the State Land Board. It consists of principal de- 
rived from the school lands of the state, the interest of which goes to the common 
school fund. Treasurer's Report, 1901, p. 10. 

113 Constitution of Idaho, 1890, Art. IX, Sec. 4, Report U. S. Commissioner of 
Education, 1892-93, p. 1406. 

11* Report U. S. Commissioner of Education, 1904, I, p. Ixxxii. 

lis Answers given by Idaho State Treasurer to questions, Nov. 20, 1906. 

115a Elliott, E. C, Si. Sch. Sys. Leg., p. 42, No. 19s, and note 120. 

11* Report U. S. Commissioner of Education, 1902, I, p. Ixxxiv. 

11^ Ibid., p. kxxiii. 

251 



252 PERMANENT COMMON SCHOOL FUNDS 

Upon her admission into the Union in 1890, Idaho received from 
the United States, sections numbered sixteen and thirty-six in each 
Q . . township, previously reserved for the support of 

common schools by Act of Congress, March 3, 
1863.^° The total area of the sixteenth and thirty-sixth section 
lands amounted to 3,063,271 acres.^ In 1890 the state, by her 
first constitution, provided that these lands be devoted to the estab- 
lishment of a permanent school common fund, the interest only 
of which should be expended in the maintenance of the schools of 
the state.iis 

Five sources are provided by law for increasing the principal 
of the Pubhc School Fund. They are the same as those provided 
Sources of ^ or originally by the constitution as follows : ^^^ 

Increase ^^^ ^^^ proceeds of all school lands granted by 

the general government; (2) lands acquired by gift, or grant from 
any person or corporation under any law or grant; (3) all other 
grants of land or money made to the state for general educational 
purposes or where no other special purpose is indicated in such 
grant; (4) all estates escheating to the state; (5) all unclaimed shares 
and dividends of any corporation incorporated under the laws of 
the state.^13 

Present The State Land Board is the custodian of the 

Management p^^jj^ gchool Fund. 

The State Superintendent of Public Instruction apportions the 
revenue semiannually among the counties on the basis of their 
Apportionment. school population.^^" No requisitions laid upon 
Requisitions for districts nor any conditions are stated in the laws 
Participation relating to schools for sharing in the Public 

School Fund revenue. The County Superintendent is fined if 
he fails to make the reports to the State Superintendent of Public 
Instruction as required by law.^^^ The law is almost as silent re- 
garding the objects to which the revenue may be applied. It 

118 Constitution of Idaho, 1890, Art. IX, Sec. 3. 

119 General School Laws of tlie State of Idaho, 1897-98, Sec. 72. 

120 Ibid., Art. VII, Sec. 73. 

121 Ibid., Art. Ill, Sec. 34. 



IDAHO 253 

names none, but simply provides in general terms that "the in- 
terest shall be expended in the maintenance of the schools of the 
state." ^22. 122a 

122 Ibid., Art. VII, Sec. 73. 

122a In some states provisions respecting the conditions for sharing in and respect- 
ing the lawful uses of the public school moneys are not contained in the laws, but 
in the "Regulations" of the State Superintendent of Public Instruction. It was 
impossible to learn whether any such exist in Idaho. 



CHAPTER XX 
ILLINOIS 

TOWNSHIP FUND SCHOOL FUND PROPER SURPLUS REVENUE FUND 
COUNTY SCHOOL FUND 

Illinois uses the term common school fund to include the total 
Titigg_ proceeds of (i) the state school tax; (2) interest 

Condition, 1905 on the School Fund Proper; (3) interest on the 
Surplus Revenue Fund.^^^ Illinois possesses in all seven perma- 
nent school funds; only four of these, however, are common school 
funds, the other three being devoted to higher education. The 
permanent common school funds of the state are divided into 
two classes: first, trust funds, accumulations of moneys granted by 
the United States or of the proceeds of the sales of lands granted 
by the same power; second, moneys which the state has set apart 
by law for the use of common schools. These funds are all alike 
in that the income only may be expended. The common school 
funds of this first class are: (i) the Township Fund and (2) the 
School Fund Proper; of the second class, (3) the Surplus Revenue 
Fund and (4) the County School Fund.^^"* The following table 
shows the condition and relative importance of these funds in 1905 : 

Principal Income 

Township Fund $5,923,095.07125 $784,966.16128 

Township Funds, unsold lands, 6,987.2 acres, 

estimated value 9,571,580.33 125 

School Fund Proper 613,362.66 125 36,801.77 126 

Surplus Revenue Fund 335)592-33^^ 20,135.53126 

County School Funds 161,703.31 125 7)858.57 126 

Total of all permanent common school funds $16,605,333.70 $849,762.03 

123 School Laws of 111., 1903, p. 126, Sec. i. 

124 111. School Report, 1881-82, p. cxx. 

125 111. School Report, 1904-06, p. 164. 

126 From statement, Sept. i, 1906, received from F. G. Blair, 111. State Supt. of 
Public Instruction. 

254 



ILLINOIS 255 

Illinois' total receipts for common schools in 1905 derived from 
all sources, excluding balance from previous year, amounted to 
$23,999,188.55,^2^ of which, consequently, approximately three and 
one-half per cent (.035 *) was interest or income of permanent 
common school funds. The School Fund Proper and Surplus 
Revenue Fund, amounting together to $948,954.99, were long ago 
borrowed by the state which used them for its own purposes and 
pays annual interest thereon at the rate of six per cent.^^^ These 
funds may, in effect, be regarded as a permanent state debt. 

An act of the legislature approved May 17, 1907, merged the 
County School Fund with the Township Fund. The County 
Superintendent of Schools was directed to apportion and distrib- 
ute the principal of the County Fund to the townships and parts 
of townships in his county, the said principal thereupon to be added 
to the principal of the Township Fund. 

Illinois provided for the establishment of the Township Funds 

in the year 181 8 in the ordinance accompanying her first consti- 

Z . . tution.^^'' The same ordinance provided that five 

Origin ^ 

per cent of the net proceeds of the sales of public 
lands in Illinois, sold by Congress after January i, 1819, should 
be disposed of as follows : two per cent to be used in making roads 
leading to the state, three per cent for the encouragement of learn- 
ing " one sixth of which shall be exclusively bestowed on a college 
or university." ^^^ Subsequent legislation established a state per- 
manent school fund known as the School Fund Proper, consisting 
of this three per cent of the net proceeds of the sales of the public 
lands in the state, one-sixth part excepted.^^^ The first payment 
on this three per cent fund was made December 27, 1821.^^^ 

The original capital of the Township Funds consisted of 985,066 
acres of sixteenth section lands granted by Congress April 18, 1818,^'' 
the same being section number sixteen in each township throughout 

* Computed. 

128 111. School Report, 1904-06, p. 159. 

129 111. School Report, 1881-82, pp. c.xxxvii, cxliii. 

^^ Report U. S. Commissioner of Education, 1892-93, II, p. 1320. 
131 III. School Report, 1898-1900, p. 24. 



256 PERMANENT COMMON SCHOOL FUNDS 

the state. The Surplus Revenue Fund was estabhshed as a per- 
manent common school fund or deposit by an act of legislature 
March 4, 1837, which resulted in setting aside, as a permanent fund 
for common schools, $335,592.32 out of a total of $477,919.24 re- 
ceived by Illinois as this state's share of the distribution of the 
United States Surplus Revenue of 1837.* 

The County Funds were provided for by section 5 of an act 
passed February 7, 1835,^^^ which provided that teachers should not 
County receive from the pubhc school fund revenue more 

School Fund ^.j^g^j^ ^^^^ ^j^g amount due them for services rend- 

ered the preceding year, and that the sum reserved should constitute 
a new permanent fund to be known as the County School Fund.^^^ 
This act did not, as might appear, withhold from the teachers 
any portion of their wages. It " merely provided that of the amount 
earned by the teachers (in each county) only one-half should be 
paid from the interest on permanent state funds. The other half 
was paid partly from the income ... of the township and the 
remainder ... by the tax payers of the district. When the 
amount which a county was entitled (to receive from the state) 
exceeded half the amount due the teachers, such surplus was " (set 
apart as a principal of a county permanent common school fund) P^"' 
In 1881, seventy of the one hundred and two counties in the state 
possessed County Funds. These funds "have received many 
considerable additions from other sources chiefly . . . from the 
proceeds of sales of swamp lands." ^^^ 

"An act passed in 1829 provided that the Governor should bor- 
row the School Fund (Proper) on account of the state, at the rate 
Borrowed ^^ six per cent interest, the interest to be added to 

by state ^.j^g principal at the end of every year until the 

money should be refunded. ... By an Act of Legislature passed 
February 7, 1835, it was ordered that the interest accrued upon the 

* See Part I, Chap. Ill for an account of the Surplus Revenue. 

132 "An act to provide for the distribution and application of the interest on 
School, College and Seminary Funds," 111. Laws, 1834-35, pp. 22-24; M- School 
Report, 1S81-82, p. cxliii. 

132a Extract from letter, July 12, 1907, received from F. G. Blair, 111. State Supt. 
of Public Instruction. 



ILLINOIS 257 

fund should be added to the principal and remain a part of the 
same." ^^^ As was said at the beginning of this account, both the 
School Fund and the Surplus Revenue School Fund have been 
used by the state. "This (School Fund Proper) represents not 
a fund held by this state, but an amount of money which the state 
received in trust and used for its own purposes and upon which it 
has pledged itself by public act to pay interest at . . . six per cent 
until it refunds the money." ^^'^ The same is true of the Surplus 
Revenue Fund;^^^ the principal was borrowed by the state and 
exhausted in extravagant public improvements. It exists to-day 
only as an account or credit fund.* 

The only means of increasing the principal of the Township 
Funds appears to be the sale of school land, chiefly sixteenth 
Means of section land.^^® The proceeds of the sales of 

Increase swamp lands are the chief source of increasing the 

principal of the County School Funds.^^^ 

The township and county funds are managed by the treasurers ^^* 

of the respective townships and the County Super- 
Management ^ ^ J r 

intendent of Schools,^^" "but the title to these 
funds is vested in the State." ^^^ 

The revenue of the Township and County School Funds is 
apportioned by the County Superintendent of Schools among the 

townships in proportion to the number of children 

Apportionment ^ 1 r- 

under twenty-one years of age.^^*' 
No teacher can receive any share of any public fund who had 
not at the time of entering upon the duties of teaching a certificate 

* See Part. I, Chaps. I and III. Also E. G. Bourne, History of the Surplus 
Revenue of 1837, pp. 60, 61. 

133 111. School Report, 1881-82, p. xxxvi. 

134 Ibid., p. cxxxvii. 

135 Ibid., p. cxlii. 

136 School Laws of 111., 1903, Art. 12, Sec. 16. 

137 111. School Report, 1881-82, p. cxliii. But the State Superintendent of Pub- 
lic Instruction writes, "County Boards are not authorized to add proceeds derived 
from sale of swamp lands to the principal of county funds," cf. foot-note 124. 

138 School Laws of 111., 1903, Art. Ill, Sec. 34. 
130 Ibid., p. 17, Art. II, Sec. 21. 

i« Ibid., Sec. XX. 



258 PERMANENT COMMON SCHOOL FUNDS 

of qualification as required by law.^"*^ Certain returns must be 
submitted and in some cases bonds executed and filed by school 
Conditions of officers before a township, district or ofl&cer can re- 
Participation ceive any part of the public school revenue.^^ 

But the penalties for failure to fulfil these conditions are imposed 
upon the ofiicers or teachers in their individual capacity, so that 
although the Common School Fund may be withheld, it apparently 
need never be forfeited.^^^ 

"1 Ibid., p. 98, Sec. 4. 

142 Ibid., p. 98, Sec. 5. 

"3 Ibid., p. 17, Sec. 18; p. 143, Sees. 9, 10. 



CHAPTER XXI 

INDIAN TERRITORY* 

"Muscogee, Indian Territory, October 8, 1906. 
"Prof. Fletcher Harper Swiet, 

"Dear Sir: Replying to your letter of recent date I will say that we have 
no school lands in this Territory. All the lands in the Indian Territory belong 
to members of the Five Civilized Tribes, and Congress has no authority to 
reserve any of it for school purposes. Our new statehood bill by which this 
Territory is to be combined with Oklahoma, contains a provision by which 
Congress appropriates on behalf of this Territory a school fund of $5,000,000 
in lieu of the usual school fund donations. 

"Yours respectfully, 
"John D. Benedict, 
'^^Superintendent." 

* See also Oklahoma. When first undertaken, this work set the year 1902 as 
its limit. Later it was decided to endeavor to extend the limit to 1905. In some 
cases as indicated, conditions of 1906 are reported. I regret to say that I was 
unable to bring Indian Territory and Oklahoma beyond 1905. 

F. H. S. 



259 



CHAPTER XXII 

INDIANA 
I. CONGRESSIONAL TOWNSHIP FUND. 2. COMMON SCHOOL FUND 

Indiana possesses two common school funds, the respective 
official titles of which are Congressional Township Fund^"*^ and 
Titles. Common School Fund.^'*^ The Congressional 

Condition, 1905 Township Fund consists, in 1905, of $2,473,1/^4 
and eight hundred four and six-tenths acres ^^ of unsold sixteenth 
section lands, the proceeds of which when sold will be added to 
the principal of the fund. The estimated value of these lands is 
$35,413.^*^ The total estimated principal of the fund is therefore 
$2,508,557. The Common School Fund consists, in 1905, of 
$8,168,082.74.^'*^ The total of these two funds, including the esti- 
mated value of unsold land, is therefore $10,676,630. The an- 
nual income from these two funds in 1905 is as follows: Congres- 
sional Township Fund, $148,288.62; Common School Fund, 
$490,084.96;^**^ the total income from permanent common school 
funds, $638,373.58, or approximately five and three-tenths per cent 
(.053 *) of $1 1,927,050,^'*^ the total common school revenue in 1905 
derived from all sources. 

The origin of the Congressional Township Fund may be briefly 
^ . . stated: Before her admission as a state in 1816, 

Origin 

Congressional Indiana by an Ordinance adopted lune 20, 1816, 

Township Fund , "^ , . . „ , 

accepted among other propositions offered by the 
enabling act of Congress, the proposition that the sixteenth sec- 

*Computed. 

14* Constitution of Indiana, 1851, Art. VIII, Sec. 2; Report U. S. Commissioner 
of Education, 1892-93, p. 1337. 

^^ Statement received from F. A. Cotton, Ind. State Supt. of Public Instruction, 
Sept. 22, 1906. 

260 



INDIANA 261 

tion in each township reserved in 1804/'*" be now granted to the 
inhabitants of each township for the use of schools;^'*''' 650,317 
acres ^'^ were thus set aside. Further provision for the establish- 
ment of this fund was made this same year (1816) by the constitu- 
tion ^^^ and by the first legislature.^'*'' The constitution forbade 
that any school lands should be sold prior to 1820^^^ and it was 
not until 1828 that an act was passed authorizing such sale.^^" By 
acts passed 1833 and 1838 it was settled that the proceeds of 
these lands should not be intrusted to the state but should remain 
a township fund.^^^ The original value of this land estimated at 
$1.25 per acre would be more than $800,000, but since none of the 
land could be sold prior to 1820, the principal realized was much 
larger, being estimated in 1852 at about $1,600,000.^^^ 

The fund to-day known as the Common School Fund was pro- 
vided for by the constitution adopted November i, 1851,^^^ the 
Origin Common provisions of which Were carried out by laws 
School Fund enacted June 14, 1852.154 The establishment of 

the Common School Fund was in no sense the creation of a new 
fund. It was merely the formation of a composite fund by merg- 
ing several already existing funds and revenues. The funds com- 
posing it were not even deposited in the state treasury, but were 
allowed to remain distributed among the counties which, how- 
ever, now paid the revenue into the state treasury whence it 
was reapportioned among the counties. The following table gives 
the title of these component funds, the date of their original cre- 
ation and the amount each contributed to the Common School 
Fund: 

1*" Ind. School Laws, 1901, p. 24. 

i'»7 Ind. Revised Laws, 183 1, p. 37; Boone, R. G., History of Education in Ind., 
pp. 8, 9. 

148 Ind. Constitution, 1816, Art. IX, Sec. i. 

1^9 Boone, R. G., History of Education in Ind., p. 171. 

150 Cotton, F. A., Education in Ind., p. 175. 

1" Ibid., p. 176. 

152 Report Ind. Supt. of Public Instruction, 1852, p. 34. 

153 Constitution of Ind., 1851, Art. VIII, Sec. 2; Report U. S. Commissioner of 
Education, 1892-93, II, p. 1337. 

15^ Laws of Indiana, 1852, Chap. 98. 



262 PERMANENT COMMON SCHOOL FUNDS 

Original Provision 



Date 


Mode 


Title of Fund 


Amt. added by it to C. S. Fund 155 


1816 
1816 
1832 
1834 
1834 
1837 


Const. 

Const. 

Act 

Act 

Act 

Act 


County Seminary Fund 
Saline Fund 
Delinquent Tax Fund 
Bank Tax Fund 
Sinking Fund 
Surplus Revenue Fund 


$103,238156 

85,000 157' 158 
Nothing 

80,000 157 

4,767,805157 

567,126159 



The constitution of 185 1 declared that the Congressional Town- 
ship Fund also should constitute a part of the Common School 
Fund, but the Supreme Court decided (1854) that this could not 
be done.^^° 

The County Seminary Fund was not a permanent fund prior 
to 1 85 1, but a revenue annually expended, derived from four dif- 
Origin County ferent sources: (i) military service exemption 
Seminary Fund moneys; ^*5" (2) fines for breaches of penal laws; ^^^ 
(3) money lost at gaming and recovered to the state; ^^^ (4) salt 
fines, exacted for selling salt by the barrel without having it in- 
spected. 

As a result of a provision contained in the act of Congress 
enabling Indiana to become a state, there were reserved for the 
Origin Saline ^sc of the state thirty-sevcn and twenty-four 

^^^^ hundredths sections (23,833.6 acres) of salt lands. 

In 1832 Congress granted the state's request for permission to sell 

155 The amounts given in different reports do not agree with themselves nor with 
Boone. 
158 Boone, R. G., History of Education in Indiana, p. 186. 

157 Report Supt. of Public Instruction, 1871-73, p. 16. 

158 Boone makes this $5,000; History of Education in Indiana, p. 183. I take 
amount given by reports 1871-73 and 1900. 

159 Boone, R. G., History of Education in Indiana, p. 196, note. 

160 Report Supt. of Public Instruction, 1898, p. 60. 

161 Constitution 1816, Art. IX, Sec. 3; Report U. S. Commissioner of Education, 
1892-93, II, p. 1319. 

162 Revised Statutes, 1838, Sec. 4; Report Supt. of Public Instruction, 1900, 
pp. 299-300. 

163 Report Ind. Supt. of Public Instruction, 1900, p. 297; Ibid., 1872, p. 15; 
Boone, History of Education in Ind., p. 181 £f. 



INDIANA 263 

these lands upon condition that the proceeds be applied to educa- 
tion. By a special act (1834) these proceeds became a permanent 
fund, ^^^ known as the Saline Fund. 

On January 28, 1834, Indiana granted a charter to a state 
bank capitalized at $1,600,000 in fifty dollar shares, one-half held 
Origin Bank ^y the State and one-half by individuals.^*^^ The 

Tax Fund '«* charter provided that upon the shares held by 

individuals an annual tax of twelve and one-half cents should be 
levied which "shall constitute part of the permanent Common 
School Fund." 

The Sinking Fund owes its origin to sections 113-114 of the 
charter of the Indiana State Bank, just referred to. These sec- 
Origin Sinking ^ions provided that at the expiration of the bank's 
•^"^^ ^'' charter (it expired 1857) all the state's profits 

should be added to the permanent school fund.^^^ 

The origin of the Surplus Revenue Fund needs no explanation 

here, being given elsewhere in this volume.* As the result of the 

act passed by Congress, June 23, 1836, providing 

and Delinquent for the distribution among the various states of 

Tax Funds , ^^ . , _ ° . . . , 

the United States revenue remaining m the 
treasury January i, 1837, Indiana received $860,254. Two-thirds 
of this, $567,126, was distributed among the counties to be loaned 
by them, the interest on these loans to be devoted to schools. This 
portion of the principal appears to have been exhausted or lost.^^^ 
The remainder, one-third, was used as part of the capital of a state 
bank. Since 1851 the counties appear to have been held respon- 
sible to the state for the payment of the interest. The Surplus 
Revenue Fund must therefore be regarded as a permanent debt 
or credit fund. 

* See topic Surplus Revenue Fund, Chap. Ill in Part I. 

1** Report Ind. Supt. of Public Instruction, 1871-73, pp. 15-16; Boone, History 
of Education in Ind., pp. 186-188; Laws, 1834, pp. 12-38; Laws, 1834, Chap. VII, 
Sees. 1-122. 

165 Report Ind. Supt. of Public Instruction, 1900, pp. 298, 299; Ibid., 1871-73, 
p. 16; Boone, History oj Education in Ind., pp. 189, 193. 

188 Bourne, E. G., History of the Surplus Revenue of 1837, pp. 60-64, 
122, 



264 PERMANENT COMMON SCHOOL FUNDS 

The history of the Delinquent Tax Fund, which up to the present 
time has not added a dollar to the Common School Fund ^^'^ will 
be taken up later. 

It is altogether impossible to form even any approximate esti- 
mate of the funds of which the Common School Fund has been 
deprived by mismanao;ement or by insuflSicient 

Loss and . . . . . 

Sources of legislation. Three million dollars is as near an 

Increase . 1 • • 

estmiate as 1 have been able to form, but this is 
perhaps not half of the real loss. Prior to 1843, $27,918 of the 
Congressional Township Fund was lost through unpaid mort- 
gages.^^^ The constitution of 1851 and the legislation of 1852 and 
1853 provided eight sources which should increase the Common 
School Fund.^^^ As far as the records show, only three of these, — 
fines, forfeitures and estrays, — have added anything. In 1905, 
$49,353.52 was added to the Permanent Common School Fund 
from fines and forfeitures.^*^^ 

The first of the five unproductive sources is lands and other 
estates escheating to the state for lack of heirs. This source of 
Escheated school support originated in an act approved Feb- 

Estates Lost ruary II, 1843.^*^^ Owiiig to the failure of the 

legislature to provide a lapse of time after which heirs' claims to 
estates shall not be allowed, not a dollar has ever been added from 
this source to the principal or revenue of the Common School 
Fund.i*^^ 

A second source of increase provided by the constitution (1851) 
which has proved unproductive, is taxes levied on corporations. 
Corporation The first provision for such a tax was made by 

Taxes Lost ^^^ ^^^ approved January 17, 1849.^^'' In 1872 

it was claimed that two million dollars was due the Common 
School Fund from the surplus profits of the Vandalia Railroad.^^^ 
All attempts to recover this money had been unsuccessful up to 

1^ Boone, History of Education in Ind., p. 198. 

168 Report Ind. Supt. of Public Instruction, 1906, p. 811. 

169 Revised Statutes, 1843, p. 438, Chap. XXVIII, Sec. 125; Boone, R. G., 
History of Education in Ind., p. 203, note. 

1™ Boone, R. G., History of Education in Ind., p. 113. 
"1 Ibid., p. 206. 



INDIANA , 265 

1890, and I find no record of any additions from this source since 
that date.i^^ 

Congress, by act approved September 28, 1850, granted to the 
states of the Union swamp lands. Prior to 1880 Indiana had con- 
veyed 1,2 c;7, 1588 acres of such lands. Congress 

Swamp Land j j ot^o b 

Proceeds provided that the proceeds should be applied 

Diverted i" , . , <. , , 

exclusively as far as necessary to the reclaimmg 
of the lands; the constitution of Indiana provided that the surplus 
should constitute a part of the Common School Fund.^^^ Owing 
to the dishonesty of the swamp commissioners "^ and to insufficient 
legislation, nothing has been added, as far as I am able to ascertain, 
to the Common School Fund from this source, although in 1890 
it was estimated that $850,000 "^ was due. 

The Delinquent Tax Fund is important in that it represents 
the first statutory attempt of Indiana to establish a state fund (as 
Delinquent Tax opposed to township or local funds). An act 
Fund Lost approved February 2, 1832, provided that upon 

all lands whose taxes had not been paid for three years, the school 
commissioner should charge up a penalty of fifty per cent on the 
tax at a rate of one hundred per cent per year on the said tax until 
the same should be paid. The proceeds were to be loaned and 
the interest on such loans was to be applied to the support of com- 
m-on schools. After three years the land could be sold and the 
proceeds added to the Common School Fund. This source of 
school support ceased in 1843 when the Revised Statutes devoted 
delinquent taxes to other ends, but an act approved March 3, 1853, 
directed that lands returned delinquent for seven years should be 
sold and the proceeds applied to the Common School Fund of the 
state. This source appears to have added nothing to the principal 
of the Permanent Common School Fund, although it contributed 
from fifty to seventy-five thousand dollars to the current support 
of schools from 1832 to 1843. 

i''2 Ibid., p. 102. 

1^3 Report Ind. Supt. of Public Instruction, 1S66, p. 73. 
17* Boone, R. G., History of Education in Ind., p. 200. 
"5 Ibid., pp. 196, 198. 



266 PERMANENT COMMON SCHOOL FUNDS 

By a treaty with the Pottawattomie Indians, October i6, 1826, 
over 170,000 acres of land were obtained by the state for building 
Mich. Road Land ^ Toad. Subsequent legislation provided that any 
Fund Lost i'" surplus proceeds should be held through the state 
treasury for the benefit of common schools. The moneys appear 
to have been "absorbed" in the construction of the road, and noth- 
ing is known to have been realized to the Common School Fimd 
from this source. 

The Common School Fund and the Congressional Township 
Fund are both alike distributed among the counties and are man- 
Pi-esent aged by the county auditors who loan them at 

Management gj^ pgj. ^^^^ ^^ mortgaged real estate within the 

county.^^'^ 

The interest on the Common School Fund is paid into the state 

treasury and apportioned to the counties by the Superintendent of 

Public Instruction semiannually upon the basis 
Apportionment -^ '^ 

of school population.^^^ The revenue derived 
from the Congressional Township Fund is distributed semi- 
annually by the County Auditor to the township to which it 
belongs: "In making the said apportionment . . . the Auditor 
shall ascertain the amount of Congressional township school 
revenue belonging to each city, town or township, and shall 
apportion the other school revenue for tuition . . . according 
to the enumeration of children therein." ^^^ 

The sole object to which the revenue of the Common School 
^^. , Fund and Congressional Township Fund can be 

Objects ° ^ 

applied lawfully is tuition,^®" which is defined as 

the payment of teachers' wages.^^^ 

"In case any school corporation shall not have expended for 

tuition purposes in any school year, an amount as great as that 

1™ Ibid., p. 210. 

1" Report Ind. Supt. of Public Instruction, 1S90, p. 40; Ind. School Laws, 1904, 
p. 308, Sec. 442. 

178 Ind. School Law, 1901, p. 276, note 2. 

179 Ibid., 1904, p. 162, Sec. iSi. 

180 Ibid., p. 288, Sec. 391. 

181 Ibid., 1891, p. 79, Sec. 4442, note 2. 



INDIANA 267 

received from the Auditor for said year, then it shall be the duty 
of the Auditors ... to deduct from the whole amount of state 
Conditions of tuition rcvcnue apportioned, an amount equal to 

Participation ^j^^ difference between the amount of state tuition 

revenue apportioned and distributed to said corporation for use 
in such school year and the whole amount shown ... to have 
been actually expended for tuition purposes." ^^^ This is the first 
condition; the second is that if a town trustee fails to make the 
reports required by law, the county auditor shall diminish the 
apportionment to said township, town, or city by the sum of twenty- 
five dollars, and withhold from the delinquent trustee the warrant 
for the money apportioned to his township, town, or city until such 
delinquent report is duly made and filed. For said twenty-five 
dollars and any additional damages . . . said trustee shall be 
liable on his bond.^^^ 

182 Ibid., 1904, p. 162, Sec. 181. 

183 Ibid., p. 139, Sec. 142. 



CHAPTER XXIII 
IOWA 

PERMANENT SCHOOL FUND 

The permanent common school fund of Iowa, officially known 
as the Permanent School Fund,^®"* consisted in the year 1905 of a 
Title. permanent invested principal of 14,757,342.56/^^ 

Condition, 190S yielding an annual income of $214,255.38,^^^ which 
is approximately two and six-hundredths per cent (.0206 *) of 
$10,360,424.40,^^^ the total annual receipts for public schools. The 
revenue of the Permanent School Fund, the revenue derived from 
the tax estimated by the board of directors, the district tax, and 
the county tax are combined and are together known as the 
Teachers' Fund.^^*^ If we add to the above invested principal, 
$18,000, the estimated value of 520 acres of unsold common school 
lands belonging to the Permanent School Fund, we have a total 
prospective fund of $4,775,342.56.^^^ These lands yield no rent at 
present (1902 and 1905);^^^ $10,937.18 belonging to the Perma- 
nent School Fund is "held by the state" in state bonds "issued to 
cover losses arising prior to January i, 1874." ^^^ These losses 
were occasioned by loaning the fund on insufficient security .^^^ 
It appears that the state did not borrow this money, but has 
issued bonds to cover losses for which it was not responsible. 
These bonds cannot therefore be called loans to the state. They 
draw six per cent interest, which is paid out of state taxes. The 
remainder of the fund is invested chiefly in farm mortgages.^^* 

* Computed. 

184 School Laws of Iowa, 1902, p. 78, Sec. 2808; Report Iowa Supt. of Public 
Instruction, 1903, XIII. 

185 Data furnished by State Auditor Nov. 15, 1906; Report U. S. Commissioner 
of Education, 1902, I, p. Ixxxiii, erroneously includes county tax. 

186 Cf. Report Supt. of Public Instruction of Iowa, 1903, p. xiii; Ibid., p. xxvi. 

268 



IOWA 269 

Among the lands which Congress granted to Iowa upon her 

admission into the Union was section numbered sixteen in each 

township for the use of common schools, amount- 
Origin ^ ' 

mg to 1,013,614.21 acres,^^^ and also 535,473.76 

acres ^^^ granted pursuant to the Congressional land grant of 1841; 

making a total of 1,549,087.97 acres.^^^ The first constitution 

adopted (1846) provided that the proceeds of these two grants 

should constitute a perpetual fund, the interest of which should be 

inviolably appropriated to the support of the common schools of 

the state.^®^ 

I find no estimate more recent than 1868 of the loss suffered by 

the Permanent School Fund. The auditor estimated at that 

time that there had already been lost over one hun- 

Loss 

dred and twenty-five thousand dollars ($125,000) 
through carelessness, dishonesty, and mismanagement.^^^ * As 
stated in the first paragraph of this account, one of the chief 
causes of these losses was loaning the fund on insufficient security .^*^ 
The state has issued six per cent bonds to the extent of $10,937.18 
to cover part of this loss. 

The sources provided for increasing the Permanent School Fund 
were named in the first constitution: first, the proceeds of all sales 
Sources of of intestate estates which escheat to the state; 

Increase sccond, five per cent of the proceeds of the sales 

of public lands in the state.^^'^- ^^^ 

"The general management of the Permanent School Fund is 
confided to the Auditor of the State." ^^° The present State Audi- 
tor states that prior to 1874 the Permanent School 

Management ^ ' 

Fund was loaned out by the State Superintendent 
of Public Instruction. " Since this time the fund is handled by 
the county boards of supervisors and the counties are held 

* See following paragraph on "Management." 

1S7 Ibid., p. 16; Report U. S. Commissioner of Education, 1892-93, II, p. 1283, 
gives sixteenth sections as 905,114 acres. 

188 Constitution 1846, Art. IX, 2nd Sec, 3; Report U. S. Commissioner of Educa- 
tion, 1892-93, II, p. 1332. 

189 Report Iowa Supt. of Public Instruction, 1868, p. 18. 

190 Ibid., 1875, p. 50. (No evidence of any change since.) 



270 PERMANENT COMMON SCHOOL FUNDS 

responsible for all loss."^'*^ The fund is now invested chiefly in 
farm mortgages made by and under the control of these county 
boards. ^'^ On the other hand, the State Superintendent of Pub- 
lic Instruction in his report for the year iS6S (p. i8) claims that 
the county system then in vogue was the cause of the $125,000 
loss already referred to. He writes, " No sane man with two or 
three milHons of dollars to invest would appoint a hundred dif- 
ferent agents in a hundred different counties and scatter his 
money broadcast over a whole state, and especially if he ex- 
pected those agents to look after his interests without any special 
compensation." The same officer's report for 1875 (p. 50) states 
that the general management of the fund is intrusted to the 
State Auditor. It would appear then that the changes in man- 
agement have been from State Superintendent to State Auditor, 
and from state responsibility for losses to county responsibility. 

The revenue of the Permanent School Fund is apportioned semi- 
annually by the County x^uditor among the several school corpora- 
Apportionment, tions of the county on the basis of school popula- 
^^j^'^*^ tion.^^^ The revenue of the Permanent School 

Fund may be applied lawfully to three classes of expenditures : ^^^ 
(i) teachers' wages; (2) tuition of pupils attending school in 
another district; (3) books purchased for the district library at a 
rate of not less than five cents nor more than fifteen cents for each 
resident of school age. 

No conditions to be fulfilled in order to share in the Permanent 
School Fund revenue are named in the school laws.* The law 
Conditions of says the township board must maintain school 

Participation twenty-four weeks, but states no relation between 

this or other requirements and sharing in the revenue.^^^ 

* See Idaho, foot-note 1220. 

191 School Laws of Iowa, ed. 1902, p. 78, Sec. 2808. 

192 Ibid., 1902, p. 36, note 21; Ibid., Sec. 2803; Ibid., p. 103, Chap. no. 

193 Ibid., p. 43, Sec. 2773. 



CHAPTER XXIV 

KANSAS 
STATE PERMANENT SCHOOL FUND 

The permanent common school fund of Kansas, officially known 
as the State Permanent School Fund ^^* consisted (1902) of a per- 
Titie. Condition, manent invested principal of $7,531,732 ^^^ and a 
1902 and 1904 reservation of 510,440 acres ^^'^ of unsold school 
lands estimated at $1,531,320,^^^ making a total estimated and 
invested fund of $9,063,052. Only 200,160 acres,^^^ valued at 
$600,480^^^ of these unsold lands are under lease, so that the 
present productive fund invested and estimated may be valued at 
$8,132,212. The revenue derived from the State Permanent School 
Fund for the year 1902 amounted to $421,649,^^^ which is approxi- 
mately nine and three-tenths per cent (.093 *) of $4,521,389,^^^ the 
total annual receipts for public schools. Data for 1904 furnished 
by I. L. Dayhoff, State Superintendent of Public Instruction, ap- 
pear to be only approximate. They are as follows: 

1904 

Total common school revenue $5,156,775.94189 

Revenue from State Permanent School Fund 408,130.81199 

Principal of State Permanent School Fund 7,500,000.00 19* 

Estimated value unsold school lands 5,000,000.00 199 

Acreage unsold school lands, 1,000,000 acres.i^s 

* Computed. 

194 Laws Relating to the Common Schools of Kansas, Compiled 1905, p. 131, 
Sec. 355. 

195 Report U. S. Commissioner of Education, 1903, I, p. cvii; Kan. School 
Laws, 1903, p. 136, Sec. 329. 

196 Report U. S. Commissioner of Education, 1902, I, p. Ixxxiii. 

198 Report Kan. State Supt. of Public Instruction, 1901-02, p. 268. 

199 Statement, Sept., 1906, received from I. L. Dayhoff, State Supt. of Public 
Instruction. 

271 



272 PERMANENT COMMON SCHOOL FUNDS 

By the constitutional ordinance made a part of her first consti- 
tution, 1861, Kansas set apart for the support of common schools 

. . the following lands ^^'^ and proceeds granted by- 

Congress to the state in 1861 upon her admission 
into the Union: (i) sections numbered sixteen and thirty-six in 
each township, including Indian reservations and trust lands; (2) 
500,000 acres of land to which the state was entitled under the act 
of Congress, 1841; these lands were never added to the State 
Permanent School Fund (see School Laws of 1905, p. 5 ^^^) ; (3) 
five per cent of the future proceeds of federal lands. The first 
grant may be considered as the original capital of the State Perma- 
nent School Fund and the third as a means of increasing the prin- 
cipal. The amount of land granted proved to be as follows: 
2,801,306 acres, sixteenth and thirty-sixth section lands; ^° 265,000 
acres, indemnity Indian reservation school lands; ^°° making a total 
original capital of 3,066,306 acres. 

The minimum sale price was fixed by law (1864) at $3.00 per 
acre.^"^ This should have produced a fund of $10,188,918. The 
minimum price now (1906) is $1.25 per acre.^^^ 
The total of the present invested and prospective 
capital, as already stated, is $9,063,052. This would indicate a 
decrease of over one million dollars. In 1880 it was estimated that 
the fund would eventually reach the twenty million mark.^*^^ It 
therefore is impossible to estimate how much of the fund has been 
lost, but that there has been a large amount lost seems to be shown 
by the earlier reports. The Superintendent in 1878 writes that 
the state has sustained great losses in the sale and management of 
school lands and adds, "these losses are rapidly increasing and if 
they continue will amount to millions of dollars." ^^^ In 1894 a 
long list of bonds was reported on which interest had been due for 

197 Constitutional Ordinance, Sees, i, 6, 7; Gen. Laws of Kansas, 1861, p. 46; 
Report U. S. Commissioner of Education, 1892-93, p. 1342. 

200 Report Kan. State Supt. of Public Instruction, 1878, p. 35, note 163. 

201 Report Kan. State Supt. of Public Instruction, 187S, p. 41; Laws of Kan., 
1864, p. 188, Chap. CII, Sec. 2. 

202 Report Kan. State Supt. of Public Instruction, 1880, p. 55. 

203 Ibid., 1878, p. 36. 



KANSAS 273 

one year or longer as well as some $15,000 worth of fraudulent 
bonds, and $100,000 worth of bonds " upon which interest has not 
been paid for a long time." ^^'^ As already stated, the 500,000 acres 
(Act of Congress, 1841) set apart for the permanent school fund by 
the first constitution and constitutional ordinance, have never been 
added to it; we may estimate this loss at the least as $1,500,000. 

"Lands once sold but afterward forfeited to the state through 

failure of the purchaser to pay interest and taxes as required by 

law . . . remain in the hands of the original 

Causes of Loss _ " 

purchaser, and are cultivated by him, the state 
deriving no benefit from them," ^°^ thus wrote Superintendent 
Lenmon in 1878, and thus wrote Superintendent Stanley eighteen 
years later .^°^ Among the causes which led to the loss of the State 
Permanent School Fund are poor management, carelessness, bad 
investments, insufficient legislation. 

The means for increasing the principal provided by the first 
constitution are as follows :^°^ the proceeds of the sales of (i) 
Present Sources sixteenth section lands; (2) thirty-sixth section 
of Increase lands; (3) intestate estates; (4) five per cent of 

sales of federal lands within the state; (5) in 1901 a fifth source was 
added, namely, one-tenth of one per cent of capital stock of corpo- 
rations paid as charter fee.^"^ 

The State Superintendent of Public Instruction, Secretary of * 
State, and Attorney-General constitute a Board of Commissioners 
for the management and investment of the State 

Management " 

Permanent School, State Normal School, and State 
University Funds. The Secretary of State is president and the 
Superintendent of Public Instruction is secretary of this board.^"^ 
The State Treasurer is the custodian of all moneys belonging to 

204 Ibid., 1893-94, pp. 50 S. 

205 Ibid., 1895-96, p. 37. 

206 Constitution, 1859, Art. VI, Sec. 3; Kan. Common School Laws, compiled 
1905, p. 5; Report U. S. Commissioner of Education, 1892-93, II, p. 1343; Dassler, 
Gen. Slats of Kan., 1901, p. 49. 

207 Gen. Siats., 1901, Sec. 1264. 

208 Laws Relating to the Common Schools of Kan., compiled 1905, Chap. 19, 
Sec. 355, p. 131. 



274 PERMANENT COMMON SCHOOL FUNDS 

the State Permanent School Fund and of all bonds, mortgages, 
etc., belonging to it.^*'^ 

The revenue is apportioned semiannually by the State Super- 
intendent of Public Instruction upon the basis of county school 
Apportionment. population (five to twenty-one years) }^'^ It is then 
Objects reapportioned by the County Superintendents 

among the districts and parts of districts upon the same basis.^^^ 
The objects to which the revenue may be applied are not named 
in the laws except negatively.* It cannot be used for denomina- 
tional nor religious schools,'^^ nor for purchasing school sites,^^^ 
nor erecting school buildings.^^^ These last two classes of expendi- 
ture must be met by district tax.^^^ 

Two conditions must be fulfilled by a district in order to share 
in the revenue of the State Permanent School Fund: (i) the 
district must maintain a common school for at least three months 
Conditions of during the school year ending June 30; (2) the 

Participation district must submit through its clerk its annual 

report to the County School Superintendent in time to be included 
in his annual report.^^"* 

* See Idaho, foot-note 122a. 

209 Ibid., p. 134, Sec. 364. 

210 Ibid., p. 116, Sec. 318. 

211 Ibid., p. 45. Sec. 71. 

212 Constitution of Kan., 1859, Art. VI, Sec. 8; Laws Relating to the Common 
Schools of Kansas, 1905, p. 6. 

213 Columbian History of Education in Kansas, compiled by Kansas Educators, 
IV, I. 

21* Laws Relating to the Common Schools of Kansas, compiled 1905, p. 45, 
notes 87, 88. 



CHAPTER XXV 
KENTUCKY 

PERMANENT SCHOOL FUND 

The laws and official reports of Kentucky use the term school 
fund to include the state school property tax, the revenue of the 
Title. Present permanent school fund and school money derived 
Condition from some other sources.^^^ The permanent com- 

mon school fund of Kentucky, known officially as the Permanent 
School Fund,^^^ is a permanent debt of $2,418,996.66.^^'' The 
principal of the Permanent School Fund was long ago borrowed by 
the state which used it for its own purposes. The state has filed 
bonds covering the entire sum thus diverted, and now pays on them 
six per cent revenue out of the sinking fund. These bonds are 
regarded as an irrevocable debt payable at the will of the legisla- 
ture.^^^' ^^® In 1905 the total common school revenue derived from 
all sources amounted to $2,488,659.80,^^' of which $145,139.80,^^'' 
or approximately five and eight-tenths per cent (.058 *) was the 
interest paid by the state on the Permanent School Fund. The 
management of the Permanent School Fund is intrusted to the 
state legislature.^^^ The State Auditor keeps an account of it.^^® • 

By an act approved December 18, 1821, Kentucky set aside one- 
half of the net profits of the stock held by the state in the Bank of 
^ . . the Commonwealth, " as a fund which shall be 

Origin 

known by the name of the Literary Fund, forever 
maintained as such for establishment and support of a system of 

* Computed. 

215 Ky. Common School Laws, 1904, p. 9, Sees. 8, 9. 

216 Report Kentucky State Supt. of Public Instruction, 1892-93, pp. 671, 672. 

217 Data furnished Sept. 3, 1906, by J. H. Fuqua, Sr. Ky. State Supt. of Public 
Instruction. 

218 Constitution of Ky., Sec. 185 (Ky. School Laws, 1905, p. 4). 

219 Ky. School Laws, 1905, p. 11, Sec. 11. 

275 



276 PERMANENT COMMON SCHOOL FUNDS 

general education." ^^° Section 3 of this act shows that the income 
of the fund was intended for common schools. The income from 
this stock was at that time about $60,000 per year.^'^ Very little 
of this appears to have been used for schools, but was used by the 
state to meet its own general expenditures. Edwards asserts that 
in 1832 $140,917 of the fund remained, but Mayes writes that by 
1826 nothing of the Literary Fund remained.^^^ If we accept the 
latter's statement we must date the present fund from 1838, when 
the legislature determined that $65,978, the income of $850,000 of 
Kentucky's share of the United States Surplus Revenue distributed 
in 1837, should be used perpetually for the support of common 
schools.^"^ 

It has already been shown how small a share of the revenue of 
the Literary Fund ever reached the common schools. In 1840, 
Loss and ^wo years after the second attempt to establish a 

Diversion permanent school fund, the school funds of the 

state were seized upon and used to liquidate the state debt. By 
1843 the entire principal of the fund had been used for roads and 
the "improvement" of rivers; and the state was in debt to the fund 
to the amount of $116,000. In 1845, $917,550 of state school 
bonds, representing the invested Surplus Revenue,^^ were sur- 
rendered by the Board of Education and burned in the presence 
of witnesses.^^^ In 1848 the state issued bonds to the amount of 
$368,768 to cover its indebtedness to the School Fund. In 1850 
the revised constitution provided that "the capital of the fund 
called and known as the 'Common School Fund,'" consisting of 
$1,225,768 of state bonds, plus $73,500 in stocks of the Bank of 
Kentucky, and $51,223, the balance of unexpended interest of the 

220 Acts, 1821, p. 35, Chap. CCLXXXIV, U. S. Bureau of Education, Circular 
of Information, 1899, III, p. 330. 

221 U. S. Bureau of Education, Circular of Information, 1899, III, p. 331. 

222 "Edn. and Lit. Insts. in 1832," Barn. Am. Joiirn., 1877, p. 335. 

223 Report U. S. Commissioner of Education, 1895-96, p. 324. For an account 
of the Surplus Revenue see Part I, Chap. III. 

224 E. G. Bourne, Hist, of the Surplus Revenue of 1837, P- 66. 

22B Laws of Ky., 1845, P- 69, Chap. 264, Sec. 4; Report U. S. Commissioner of 
Education, 1899-1900, I, p. 512. 



KENTUCKY 



277 



fund for the year 1848 "shall be held inviolate" for the purpose of 
sustaining a system of common schools and the revenue should be 
applied to no other purpose/^^ As already pointed out, such a 
provision can hardly be considered the restoration of the lost 
principal. It is an acknowledgment of the state's indebtedness, 
and with subsequent legislation gives an assured source of school 
support. But the interest of the Permanent School Fund is paid 
from the interest of the Sinking Fund, and it would take an act 
of legislature to compel the state to meet the payment of the prin- 
cipal. The causes of the loss and diversion may be named briefly 
as follows: spirit of opposition to public schools, insufficient legis- 
lation, hostile legislation. 

The principal of the Permanent Fund School may be increased 
Sources of ^y grants, gifts, and devises of real and personal 

Increase property.^^^ 

The state legislature may be said to manage the 

Management . 

fund, since the control of it rests with them.^^^ 

The Superintendent of Public Instruction apportions the revenue 
annually among the counties upon the basis of their school popula- 
tion. It is then paid upon his warrant by the 

Apportionment l i j 

Auditor of Public Accounts bimonthly to the 
County Superintendents of each county and to the treasurer of the 
Board of Education of each city, town, or village organized as one 
district.^^^ 

"Except as otherwise expressly provided in this chapter, no 
part of the common school fund or of the revenue thereof shall be 
_ used for any other purpose than the payment of 

teachers of common schools legally qualified."'-^ 
The other objects expressly provided for are the payment of the 
"expenses of the State Department of Education of whatever 
character or kind." "^° 

228 Art. XI, Sec. i, Constitution adopted June ii, 1850; Wickliffe, Turner and 
Nicholas, Ky. Revised Statutes, 1852, p. 72. 

227 Ky. School Laws, 1905, p. 20, Sec. 35. 

228 Ky. School Laws, 1905, p. 12, Sees. 13, 14. 

229 Ibid., p. II, Sec. 10. 

230 Ibid., Sec. 9. 



278 PERMANENT COMMON SCHOOL FUNDS 

Three conditions must be fulfilled by a district in order to re- 
ceive its share of the Permanent School Fund revenue, viz.: (i) the 
Conditions of maintenance of a school for at least six months; 
Participation ^3) the school must be taught by a qualified 

teacher; (3) the school must be free and open to every child between 
six and twenty years of age within the district.^^^ 
231 Ibid., p. 7, Sec. 2. 



CHAPTER XXVI 

LOUISIANA 

PREE SCHOOL FUND 

The permanent common school fund of Louisiana, officially 
known as the Free School Fund,"^^ consists of three parts: first, 
xitie. Ii)i30j867, declared by the constitution to be a 

Condition, 1905 perpetual state debt due to the Free School 
Fund,^^^ on which the state pays four per cent interest; second, 
consolidated and constitutional bonds, which constitute the only 
part of the principal that has a real existence and which represent 
the proceeds of the sales of sixteenth section school lands made since 
January i, 1880, and amounting in 1895 to $243,930;^^^ third, 
unsold common school lands, the area of which it has not been 
possible to ascertain.^^^*^ That portion of the fund represented by 
the state debt exists nowhere except on the books of the state. 
Its four per cent revenue was paid, 1879-98, out of the education 
tax,^^^ and from 1898 to the present (1902) out of the interest tax 
fund,^^^ i. e., state taxes. In 1905 the principal of the Free School 
Fund, including the perpetual four per cent loan, amounted 
to $1,759,386.76.^^^'' The interest on the principal amounted 
to $61,793.40'^^'' and the rent of school lands amounted to 
$19,618.55,2^^'' making a total income from the Free School Fund 
of $81,411.95. The total receipts from all sources for common 
schools this same year amounted to $2,218,912.57,2^^" of which, 
therefore, approximately three and seven-tenths per cent (.037) was 

232 Constitution of Louisiana, 1898, Art. 257; Compilation of Laws of La. Re- 
lating to Free Public Schools, 1904, p. 18. 

233 Report La. State Supt. of Public Education, 1894-95, p. iv. 

233a Statements Sept. 6, 1906, and July 11, 1907, received from J. B. Aswell, 
La. State Supt. of Public Education. 
231 U. S. Bureau of Education, Circular of Information, 1898, No, i, p. 104. 
286 Report La. State Supt. of Public Education, 1898-99, p. 7. 

279 



28o PERMANENT COMMON SCHOOL FUNDS 

derived from the interest on the Free School Fund and the rent 
of common school land. 

Louisiana received from the United States as the result of Con- 
gressional lands grant in the years 1806 and 1843, 786,044 acres 
of sixteenth section lands for the use of common 

Origin 

schools.^*^ To this Congress added (September 6, 
1841) a grant of ten per cent (.10) of the proceeds of the sale of all 
federal lands to be applied to the school fund.-^*' A new constitu- 
tion adopted 1845 made general provision for the establishment of 
"a perpetual fund on which the state shall pay an annual interest 
of six per cent." ^^^ The constitution provided that this perpetual 
fund should be held as a loan by the state which should pay annual 
interest of six per cent thereon; "which interest, together with all 
the rents of unsold (school) lands shall be appropriated to the sup- 
port of such schools, and this appropriation shall remain inviolable." 
The sources which the constitution devoted to the perpetual school 
fund were as follows: (i) the proceeds of all school lands previously 
granted to the state by the United States; (2) proceeds of all lands 
hereafter granted or bequeathed to the state not expressly granted 
or given for some other purpose; (3) proceeds of intestate estates 
escheating to the state.^^'^ By the constitution adopted in 1852 
(Title VIII, Art. 137) these sources of the "perpetual school fund" 
were continued and the interest on the state's share of the United 
States Surplus Revenue of 1837 was joined with the income of the 
Perpetual School Fund. On March 15, 1855, the establishment 
of the Free School Fund was completed by an act which provided 
that (i) the proceeds of sale of school lands, except sixteenth 
section land; (2) ten per cent net proceeds of estates of deceased 
persons escheating to the state; (3) ten per cent of proceeds of 
sales of United States lands to which state is entitled shall be and 
remain a perpetual fund to be called the Free School Fund. On 
this fund the state shall pay an annual interest of six per cent, 

236 U. S. Bureau of Education, Circular of Information, i8gS, No. i, p. 69. 

237 Constitution of La., 1845, Title VII, Art. 135; P. L. Phillips, La. Revised 
Statutes, 1856, also quoted in Report U. S. Commissioner of Education, 1892-93, 
II, p. 1329. 



LOUISIANA 281 

which interest, together with the interest of Louisiana's share of 
the United States Surplus Revenue, $477,919,14, and with the 
rents of all unsold lands, except sixteenth section lands, shall be 
appropriated for the support of public schools in this state.^'^^ It 
should be noted here that the state had spent every dollar of its 
surplus revenue before 1840 in appropriations, so that in devoting 
this fund to schools it was merely establishing a credit fund, not a 
productive resource.^^^ It was decided in Louisiana that town- 
ships, not the state, owned the sixteenth section lands. Some 
gave up these lands to the state and the proceeds became a part 
of the Free School Fund.^^° Others held them, still possess them 
(1898) and derive an appreciable revenue from them. Others 
have lost all record of them.^^^ 

As a result of the Civil War, ''in a few years the public debt of 

Louisiana was increased by the sum of $40,000,000." ^^ In 1872 

the Government sold at public auction the whole 

Loss '■ 

Free School Fund which had been invested in 
state bonds and which "amounted to more than $1,000,000."^^ 
The constitution of 1879 placed the Free School Fund among the 
perpetual debts of the state, but reduced the interest from six to 
four per cent and declared that this interest as well as the interest 
on the Seminary, Agricultural, and Mechanical funds should be 
paid not out of the general revenue of the state, but out of the tax 
(annual appropriation) collected for pupils' education.''^^ ''This 
was a wholesale robbing 'of Peter to pay Paul.' " 

Provision is made for increasing the principal of the Free School 
Fund from the following sources: (i) the proceeds of all lands 
heretofore granted by the United States to the state for the use 
or support of schools, except the sixteenth sections (which belong 

238 U. S. Bureau of Education, Circular of Information, 1898, No. i, p. 103, 
taken from Bureau School Laws, p. 47, Art. CVIII. 

239 Bourne, Edward G., History of the Surplus Rei'enue of 1837, PP- 68> ^P- 
Consult Part I, Chap. Ill, for an account of the U. S. Surplus Revenue Fund. 

2^0 Report U. S. Commissioner of Education, 1S95-96, I, p. 312. 

241 Ibid., 1894-95, II, p. 1304. 

2^ Ibid., II, p. 1303. 

2^ Constitution of La., 1879, Art. 233. 



282 PERMANENT COMMON SCHOOL FUNDS 

to the townships) ; (2) the proceeds of all lands heretofore granted or 
bequeathed to the state when no other purpose is stated in grant or 
Sources of bequest; (3) ten per cent of the net proceeds of sales 

Increase -^* ^f public lands accruing to this state under act of 

Congress approved September 4, 1841; (4) proceeds of intestate es- 
tates escheating to the state; (5) gifts; (6) appropriations by legisla- 
ture; (7) inheritance tax;^"^^" (8) proceeds of Dried Lake Lands. " ^^^^ 
To this revenue of the Free School Fund is added that of (i) the 
Trust Fund (United States Surplus Revenue Deposit of 1837); (2) 
rent of all unsold school lands except that of sixteenth section land. 
The Free School Fund is borrowed by the state which pays an 
annual interest on itof fourper cent.-'^ The townships control the 

sixteenth section lands belonging to each. They 
Management 

may lease or sell them. In the latter case the 

proceeds may be paid into the State Treasury and the state 

will, according as the township votes, either pay to the township an 

annual interest or add the interest as an accumulated fund to the 

credit of the township until called for.^^^ 

The revenue of the funds appropriated by the General Assembly 

for the support of the public schools of the state is apportioned 

by the Superintendent of Public Education in 
Apportionment 

February, June, and November among the parishes 
of the state upon the basis of school population (six to eighteen 
years "^^). No provision is made by the laws regarding the objects 

to which the revenue of the Free School Fund 

Objects. 

Conditions of shall be applied, nor regarding any conditions 

Participation i r i -n i i 

that must be fulfilled by the parishes in order to 
receive their respective share.* 

* See Idaho, foot-note 122". 

243a Data furnished Sept. 6, 1906, by J. B. Aswell, State Supt. of Public Educa- 
tion. Cf. Compilation of Laws of La. Relating to Free Public Schools, 1904, 
p. 61, Art. 45. 

244 Revised Statutes of La., 1904, Sec. 2957; Compilation of Laws of La. Re- 
lating to Free Public Schools, 1904, p. 60. 

2-»5 Ibid., Sec. 2936; Compilation of Laws of La. Relating to Free Public Schools, 
1904, p. 56. 

240 Compilation of Laws of La. Relating to Free Public Schools, 1904, p. 49. 



CHAPTER XXVII 

MAINE 
PERMANENT SCHOOL FUND 

The official title of the permanent common school fund of 

Maine is Permanent School Fund.^'^^ It is sometimes called the 

State School Fund to distinguish it from "the 

Importance. School Fund proper," the latter term being used 

Condition, iQOS ^ . i , ^, ^ • j r 

to mclude the aggregate revenue received from 
(i) local funds, (2) the Permanent School Fund, and (3) town 
taxation.^"^^ The Permanent School Fund has never yielded any 
considerable portion of the total of Maine's annual school revenue. 
Between 185 1, the first year of its distribution, and 1902, the per 
cent it contributed toward the total expenditure ranged from .052 
(i85i)^''^^ to .014+ (i902),^'^^ with an average of .045.^^^ In 1905 
the principal of the fund amounted to $442,757 ^^ and the annual 
interest therefrom to $26,565,^'''^ approximately one and two hun- 
dredths per cent (.oioiS)^'^^ of $2,607,783. 87,2'*» the total public 
school revenue for 1905, derived from all sources. The Perma- 
nent School Fund of Maine may be termed a credit fund, for "the 
state used the money received for the credit of the Permanent 
School Fund and pays six per cent for its use." ^^^ The importance 
of this fund, therefore, lies not in the largeness of its contribution 
in the past nor in the present, but rather in the unifying effect it 
has had on the Maine school system as a whole. It interests us as a 

247 Laws of Me. Relating to Public Schools, compiled 1905, p. 39, Sec. 122. 

24S Me. School Report, 1903, App. p. 62. 

24" Statement received Nov. 8, 1906, from Edward Wiggin, Secretary Dept. of 
Public Instruction. 

2*> Extract from personal letter from State Treasurer, Oct. 28, 1904. 

252 Computed from data taken from state and federal school reports and from 
statements received from Maine officials. 

283 



284 PERMANENT COMMON SCHOOL FUNDS 

typical school fund for the same reason that the Massachusetts 
School Fund interests us. In view of the fact that Maine was 
originally a district of Massachusetts, the earliest history of her 
school support is merely one chapter of that of the mother state. 
Both present many of the same typical conditions. Both afford 
excellent studies of states that attempted to support common schools 
without establishing any state permanent common school fund. 
Both eventually came to recognize the necessity of having such a 
fund for the purpose of centralizing and making effective the al- 
ready existing system of schools. Still further, both represent ex- 
treme democratic and individualistic tendencies which gradually 
yielded to republican and cooperative tendencies and principles. 
The support of free public schools by the towns was required 
from the date of Maine's admission to the Union, 1820. This 
was eight years before the Permanent School Fund was estab- 
lished, and thirty-one years before the first distribution of its 
revenue. 

Four sources of local school support existed in Maine prior to the 
estabhshment of the Permanent School Fund, as follows: (i) town 
Sources of Local funds, provided for by the Act of Massachusetts, 
Pr?o°r°to^p^e?mL ^7^^' ^^^ Continued by the Massachusetts-Maine 
nent School Fund Articles of Separation, 1820; (2) compulsory 
town tax, 1821;'^"'' (3) voluntary town tax, 1821;^^^* (4) contri- 
butions and gifts. To these four local means of common school 
support must be added the form of state aid that first contributed 
a revenue to common schools, namely, the bank tax established 

1833. 
To encourage the settlement of the district, Maine, then divided 

into the three counties of York, Cumberland, and Lincoln, together 
Town Funds. commonly known as the "Eastern" lands, the 
*^"sin legislature of Massachusetts in 1788 provided that 

in the disposition of all towns thereafter, whether granted or sold, 
four lots of 320 acres each, making a total of 1,280 acres, should 
be reserved for certain purposes in each and every township, as 

252a Act of 182I, Sec. I. 

2526 Ibid., Sees. 9, 10. 



MAINE 285 

follows: lot one, the "Minister's" lot for the first settled minister; 

lot two, the "Ministerial" lot for the use of the ministry; lot three, 

the school lot for the support of common schools in that township; 

lot four, the " State lot for the future disposition 

Minister and 

School Lots of the State." ^^"'^ When Maine became a state in 

Sequestered „. -tiiia-i 

the year 1820, it was provided by the Articles of 
Separation, that Maine should carry out these provisions of 1788. 
By the law of 1828, the area of lots to be reserved in the 
township was changed from 1,280 acres to 1,000 acres.^^^*^ In 

18^2^^^ it was provided that except in cases where 

Ministerial Lots t 

Devoted to the title had already become invested, the min- 

ister's claim should be ignored, and all the lots, 
that is, 1,000 acres reserved in each township should be used for 
the support of schools in that township.^^^* The fund created by 
the sale of grass and timber on these lots, together with the money 
received for the land itself, was to be invested as a permanent fund 
for the benefit of the schools.^^^ '^ In some towns these funds are 
still preserved intact; in others the funds have been loaned to the 
town and the town pays a small sum equivalent to the interest of 
Present Condition ^^^ fund; in Still Others the school fund has been 
of Tovm Funds ^gg^ ^^^ general town purposes. In 1898 there 
were three hundred and fifty-five towns that should have had 
town funds; seventy-three of these had misappropriated these 
funds.^^^' Edward Wiggin, Secretary of the State Educational 
Department of Maine, writes, "When I came to this Department 
twelve years ago I found that many towns had no lands nor fund 
' in sight. ' . . . I found, in no instance, evidence that the fund 
had been stolen or embezzled. In many instances it had been dis- 
posed of long before the memory of any living citizen, in other 
cases it had been used by the vote of the town, as per records in 
possession of the town clerk, to build a school house, make repairs, 

251 Statement received Nov. 8, 1906, from Edward Wiggin, Esq., Secretary 
Educational Department of Maine. 
252 c Me. School Report, 1898, pp. 49, 50. 
252£i Ibid., 1901, p. 49. 

252e Laws, 1832, Chap. 39; also Me. School Report, 1901, p. 50. 
252/ Me. School Report, 1898, p. 52. 



286 PERMANENT COMMON SCHOOL FUNDS 

or for some such purpose. Many towns had given a note bearing 
interest at six per cent to the school boards, and had raised the 
amount of interest each year, in addition to the other amounts, 
required by law to be raised for the support of common schools. 
I secured the passage of a law some eight years ago, (I don't recall 
the exact year) requiring every town that could not account for 
its school lands or the proceeds thereof, to raise annually forty-five 
dollars for the support of common schools, in addition to the 
amounts required by law to be raised and expended for that pur- 
pose." ^^^ 

Compulsory local tax, known as the town or municipal tax, 

assessed at a fixed rate by legislature, was provided for, as 

_ already stated, by section i, Act of 1821. This 

1. Compulsory. -was a per capita tax. The rate of tax from the 

2. Voluntary , . . 

time of its establishment through the year 1872 
was as follows in the years cited: 

Maine Local Tax Rate 1S21-1872 



I82I 


1853 


1854 


1865 


1868 


1872 


$0.40 251a 


$0.50 251 » 


$0.60=516 


$0.75 251 » 


$1.00 2516 


$0.80 2516 



This tax by the law of 182 1 was divided among school districts 
in proportion to the number of children, four to twenty-one 
years of age."''^'^ By the law of 1821, sections 9 and 10, towns 
Voluntary Were allowcd to levy upon themselves voluntary 

Town Tax taxes foi buying land for school-houses, and erect- 

ing and repairing school buildings. The last local source of school 
support which we shall mention is that of gifts and contributions. 
Gifts and ^^ ii^ the case of many other States, we have 

Contributions ^^^^ ^^^^ ^^ ^^^^^^ ^^ reliable data of the 

amounts given by these means. 

The only means of state aid to schools prior to the distribu- 

251'J Act January, 1821, Sec. i; Shidy of the History of Education in Maine, by 
Supt. of Public Schools, p. 18. 

2516 Me. School Report, 1872, p. 28. 
251 '^ Act January, 1821, Sec. V, 



MAINE 287 

tion of the Permanent School Fund revenue was the bank tax. 
On January 23, 182 1, the legislature passed an act imposing a 
M f St te semiannual tax of one-half of one per cent upon 
Support Prior to all bauks of the State. From 182 1 to March, 

Permanent . ' 

School Fund 1 83 3, this money was used for the expenses of 

the State.^^^*^ The total amount paid during 
these twenty-two years was $194,809. An act was passed 
March 4, 1833, providing that subsequently the bank tax be 
distributed by the State Treasurer to the towns and planta- 
tions of the state according to their number of pupils. ^^^'^ The 
amount of bank tax so distributed as a result of this act varied 
greatly in the different years, as will be seen by the following 
table: 

Maine School Bank Tax 

(Only form of State aid antedating distribution of income of Permanent School 

Fund) 
Year Ami. Bank Tax 

Contributed 
to Schools 

1833 $18,389 25i/« 

1837 49,41s '''^' 

1863 79,830251/ 

1864 39,385 '''" 

1867 4,475 ^''^ 

1868 4,473 '^'^ 

1869 ceased 251^ 

The income for schools from the bank tax was greatly diminished 
by the Act of 1863, passed under the pressure of local and national 
taxation.^^^* By this act there was remitted to the banks one- 
half the tax; in view of the levying of a United States bank tax.^"'' 

2"<« Me. School Report, 1857, p. 15. 

25i«Ibid., 1855, p. 14. 

261/ Ibid., 1866, p. 43. 

26iff Ibid., 1864, p. 56. 

251^ Ibid., 1867, p. 44. 

25inbid., 1868, p. 72. 

26inbid., 1869, p. 156. 

251* Ibid., 1863, p. 28, quotes act. 



288 PERMANENT COMMON SCHOOL FUNDS 

The bank tax was further and chiefly diminished by the sur- 
render of their charters on the part of many banks which went 
into the national banking system. This tax ceased in 1869.^^^'' 
It was succeeded by the savings bank tax created in 1872. It 
was not until five years after the passage of the act estabhshing 
the Permanent School Fund, that the bank tax had been de- 
voted to the support of public schools, but during the eighteen 
years prior to the first distribution of the revenue of the Perma- 
nent School Fund the bank tax continued to be the chief source 
of state school support. 

An Act passed by the legislature, February 23, 1828, entitled, 
" An Act Providing for the Promotion of Education" ^^-^ author- 
ized the land agent under the advice and direction 

Permanent ° 

School Fund of the govemor and council to sell any number of 

Created by '^ , "^ 

Legislature townships of land not exceeding twenty, already 

surveyed and not otherwise appropriated. The 
land agent was required to pay into the treasury of the state all 
sums received from the proceeds of these lands, and to keep a 
separate account of them and of all notes received in Keu of pay- 
ment, the same to constitute a Permanent School Fund, to be re- 
served for the benefit of primary schools. -^-'^ This act further 
provided that "the excess over and above what the State may 
then owe" of all moneys received by Maine from Massachusetts 
on account of war claims against the United States for services 
rendered in the War of 181 2, should constitute a second source 
of the original principal of this fund. However, the Permanent 
School Fund was deprived of this latter source by a repeal act 
passed March 11, 1835.^^^* On the date of the passage of the 
act creating the Permanent School Fund, February 23, 1828, 
thirteen townships were reserved, seven less than the maximum 
number the law allowed.^^-^ August 24, 1850, twenty-two years 

252? Laws 1828, Chap. 403. Citation taken from Maine Revised Statutes, 1840, 
p. 170, marginal reference. 

2Sih ]^g School Report, 1855, p. 15. 

252 i ibid_^ 1901, p. 52. 

252 J Computed from data given in Me. School Report, 1857, p. 17. 

252fc Me. School Report, 1S55, p. 16. 



MAINE 289 

after the creation of this fund and one year before the first dis- 
First Sale tribution of its revenue, provision was made 

of Lands ^-^^^ twelve more townships should be reserved. 

This resolve was carried into effect in 1856 (see below, " Lands 
Reserved, 1856"). The total amount of land thus set aside was 
726,625 acres.^^^* No moneys were received into the treasury 
for the Permanent School Fund, by virtue of this act until 1838. 
In that year $2,813.66 was paid into the treasury.^^^'* No 
distribution of the revenue was made until 1851, when $6,255 
was appropriated to the towns for the benefit of the elementary 
schools. It is evident that although thirteen townships had 
First Distribution been reserved in 1828, they were not selected 
of Revenue, 1851 ^^ ^j^^^^ ^-jj^-^e^ fo^^ j^ 1834, the land agent was 

directed to make a selection of the said townships, sell them, 
and pay the proceeds into the State Treasury. The proceeds of 
the lands sold up to 1855 amounted to $238,239, and the estimated 
value of the unsold land was $40,000, making the total value of 
original fund $278,239.^^^*^ 

From what has been said it appears that while the town funds 
arose out of the original provisions of the Articles of Separation 
No Constitutional ^".^ the Constitution of the state of Maine, the 
Provisions Permanent School Fund owes its origin solely to 

an act of legislature of Maine. No provisions concerning it have 
ever been made by any subsequent constitution or amendment 
thereto. 

The management of the Permanent School Fund is intrusted to 

the legislature; the State Treasurer keeps account of it. "The 

, ^ State used the money received for the credit of 

Growth * " 

the Permanent School Fund and pays six per 
cent interest for its use." '^^' The rate of interest was fixed at six 



* Maine received $955,838.25 as her share of the United States Surplus 
Revenue, distributed in 1837. This sum was given to the cities, towns, and planta- 
tions, some of which it devoted to schools; none of it was added to the State Perma- 
nent School Fund. J. Eaton, National Aid to Education, U. S. Bureau of 
Education, Circular of Information, No. 2, 1879. 

*^ ^ E.\tract from personal letter from State Treasurer, Oct. 28, 1904. 



290 PERMANENT COMMON SCHOOL FUNDS 

per cent by an act passed in 1849 ^.nd by subsequent acts.^^^™ The 
sources which have contributed to the growth of the Common 
School Fund other than those provided for by the act which created 
it, are (i) lands reserved, 1856; and (2) twenty per cent of future 
sales of public lands, 1857. In 1850 the legislature passed a Resolve 
authorizing the land agent to set apart and reserve under the advice 
Lands Reserved ^^^ direction of the governor and council twenty- 
'^s6 fQ^j- i^oii townships of undivided state lands as a 

permanent fund, for the benefit of common schools."^^" No steps 
were taken up to 1855 to carry out the provisions of this resolve.^^'*^ 
April 9, 1856, the legislature carried into effect the Resolve of 
1850 by authorizing the land agent to select and set apart these 
twenty-four half townships, and to select not more than one town- 
ship of such reserve lands during each year/'^^" It was provided 
1857 ^^^P that twenty per cent of all money hereafter accruing from 
Increased by the sale of public lands shall be paid over to the 

Public "Land ^^^ Treasurer of State, and said proceeds shall be 
^^'^^ appropriated as a Permanent School Fund for the 

benefit of common schools, the interest of which shall be paid over 
annually for their use, in the same manner as the interest on the 
school fund is now paid.'^'«' No such sales were made until 1863, 
in which year the treasurer's account shows that $29,796.75 were 
received from the land oJB&ce for general sales/^^'' March 21, 1864, 
an act was approved which appropriated the timber and lumber 
on ten townships of wild land for the term of ten years, to increase 
the School Fund, 

In 1866 the legislature resolved "that the residuary interest of 
the State in the public lands shall be apphed in aid of the Permanent 

252m Laws, 1854, Chap. 104, Sec. 6; 1833, Revised Statutes, Chap. 11, Sec. 117; 
School Law, 1901, Sec. 117. 

252n Me. Resolves, 185c, Chap. 282, p. 245; Me. Law, 1850, approved Aug. 24, 
1850. 

2520 Resolves of the State of Me., Ch. 380, p. 355; Me. Laws, 1856; also Me. 
School Report, 1S57, p. 16. 

252P Act, 1S57, Apr. 13. 

252? Me. School Report, 1857, p, 17. 

ZMr Ibid,, 1863, p. 175. 



MAINE 291 

School Fund of the State." Two years later the ten townships 
Principal In- whose timber and lumber had been devoted to 

orximbe/an/ school purposes in 1864, were now themselves 
Lumber added to the Permanent School Fund by a Re- 

solve ^^^* which directed the land agent within six months of the 
passage of the Resolve to set apart the ten townships devoted to 
school fund purposes, by the Resolve of March 21, 1864. The last 
attempt to increase the principal of the school fund was made in the 
year 1872 when the law establishing the school mill fund provided 
that all portions of said fund not distributed or expended should 
at the close of the financial year be added to the Permanent 
School Fund.^^^ ' 

As has already been stated, the first distribution of the revenue 

of the Maine Permanent School Fund took place in 1851, when 

$6,2 i;c; were distributed among the towns for the 

Participation ^ ^ od , , , 

in Interest benefit of common schools. The law did not pro- 

Voluntary 1-1 

vide any way to compel the towns to share in the 

School Fund revenue. The first condition required by law to be 

fulfilled in order to receive a share of the Perma- 
Requirements 

nent School Fund revenue v/as that the towns 
should submit school returns. The law of 1850 provided that 
towns from which no returns are received by the Secretary of the 
State by the tenth of April shall receive no portion of the Permanent 
School Fund.'^-'' The law of 1869 provided that returns should be 
submitted to the State Superintendent by the school superintend- 
ing committee or supervisors. These returns must state the num- 
ber of scholars to serve as a basis of apportioning the School Fund 
revenue.^-'^-" In 1873 it was provided that the School Fund revenue 
should be withheld from any town neglecting to raise and expend 
the school money required by law, or faithfully to expend the 
school money received from the state.^^''" In 1899 the first four of 
the following requirements were laid upon the town as condition- 

252S Resolves, 1868. 

^'^f Laws, 1872, Chap. 43. 

252« Acts, 1850, Chap. 123, Art. X, Sec. 6. 

262W Laws, 1869, Chap. 13. 

252W Me. School Report, 1901, p. 88. 



292 PERMANENT COMMON SCHOOL FUNDS 

ing their participation. By the law of 1901/^^^ the governor and 
council were authorized to withhold the State School Fund from 
towns neglecting to (i) raise and expend the school money required 
by law; (2) to examine teachers as prescribed by law; (3) to have 
instruction given in the subjects prescribed by law; (4) to furnish 
suitable text-books (free text-book law passed 1889); (5) to faith- 
fully expend school money received from the state; (6) to maintain 
all of the town schools not less than twenty weeks annually. The 
law of 1905 required the fulfilment of these six conditions and 
added two others; (7) to submit to the Superintendent of Public 
Schools the returns required by law; (8) to pay any state tax 
assessed upon such town, and to comply with all laws prescribing 
the duties of towns in relation to public schools.^^^ 

From 1851 to 1901 the interest of the Permanent School Fund 
was apportioned among the towns upon the basis of the number 
Apportionment of persons therein between the ages of four and 
of Interest twenty-one. This mode of apportionment con- 

tinues except that the school age at present is five to twenty-one 
years.^^^^ 

The purpose of the Permanent School Fund was to aid in the 
support of schools. There was no thought that it should ever sup- 
Purpose and port the schools of the state. The law was very 
Objects g]Q^ ^Q state the specific objects to which the fund 
might be applied. It has rather followed the democratic tendencies 
of New England and left it largely to the towns to decide. The 
law of 1876, chapter 68, required municipal ofiicers to make sworn 
returns of all amounts received or expended for school purposes, 
but did not call upon them to specify the objects to which the 
moneys had been applied.^^^^ The laws in general have merely 
stated that the revenue was to be applied for the support of public 
schools, and does not seem to have interpreted the term "support," 
but has rather left the interpretation to the State Superintend- 

2523; ivie. School Law, 1901, p. 6, Sec. 7. 

252^ Revised Statutes, 1840, Chap. 11, Sec. 50; Ibid., 1S83, Chap. 11, Sec. 118; 
Me. School Law, 1901, Sec. 117; Ibid., 1905, p. 39, Sec. 122. 
2522/ Me. School Report, 1901, p. 89. 
253 Ibid., 1905, p. 35; Sec. lo, pp. 7, 8, Sees. 16, 17. 



MAINE 293 

ent of Schools, or to other school authorities. The present law, 
however, names seven objects as the only ones to which the income 
of the Permanent School Fund shall be devoted: (i and 2) wages 
and board of teachers; (3) fuel; (4) janitor's service; (5) conveyance 
of pupils; (6) board of pupils; (7) tuition. From this it will be 
seen that this revenue cannot be applied to (i) the erecting or 
(2) repairing of buildings, or the purchase of (3) school property, 
(4) apparatus, or (5) text-books, (6) or insurance. Moneys for 
these purposes must be raised by town tSLxP^' 

We are unable to enter here into any lengthy discussion of the 

effects of the Maine Permanent School Fund. In general its 

, „ . effects can be classed in two groups: first, the 

Effect of Maine . . . b r j 

Permanent increase in the requirements which it has been 

School Fund -i i r i i 

possible for the state to place upon the towns, and 
second, the increase in the number of objects to which towns 
may apply their portion of the school fund. Regarding the first 
it is noteworthy that starting with the simple requirements of towns 
submitting annual returns, we find an increase in the exactions 
until it may be said to govern nearly every important phase of 
organization. 

We can better understand what the effect of the school fund has 
been upon the school system if we pause long enough to trace the 
Effects upon history of school returns. No returns were re- 

Schooi Returns q^j^.^^ I^y ^^^ ^^^^ g^l^^^j j^^^ of 1821. The law 

of 1827 required that selectmen of towns make returns once in 
three years to the Secretary of State on blanks furnished by him. 
The returns thus secured were very imperfect, and no apportion- 
ment of school money was made on returns from the towns prior 
to 1833.^^^-'^ In 1837 an act was passed providing for annual 
returns from town selectmen, and plantation * overseers to serve 
as a basis of distribution of bank taxes.^^*^' The same act provided 
that the Secretary of State should make an abstract of returns, but 

* Plantation is a term applied to a town prior to its becoming incorporated as 
a town. 
2522 Me. School Law, 1905, p. S, Sec. 19. 
252-^ Me. School Report, 1901, pp. 4S-49. 
252<^Ibid., pp. 52-53. 



294 PERMANENT COMMON SCHOOL FUNDS 

the returns proved so unreliable, that the Resolve of 1838 was 
repealed 1842. In 1840 school returns were made the basis of 
distribution of the school ixindP-^ The first reliable school re- 
turns were made in 1847 at the second session of the Board of 
Education by its secretary .^^^-^ 

What has been said is sufi&cient to show the broad sphere of influ- 
ences which the Permanent School Fund has exerted. In our para- 
graph upon the importance of the School Fund, 

Relation to , . , , , . , • , 

Present Means we have pomted out the relative amount which 
it has contributed toward total expenditure. This 
is one way of indicating its relation to other means of support. The 
means of support since the establishment of the Permanent School 
Fund have included all the local means which existed prior to its 
establishment. The bank tax existed until 1869, the savings bank 
tax was estabhshed in 1872, and the mill or state tax was estab- 
lished also in 1872. We have already given the history of the state 
bank tax. The savings bank tax or fund established by the legis- 
Savings Bank lature, 1872, Succeeded the state bank tax. It 
Tax, 1872 ^g^g ^ semiannual tax of one-fourth of one per 

cent on the total amount of deposits in all the savings banks of 
the state as returned to the State Treasurer the first of May and of 
November in each year, and payable to the treasurer within ten 
days therea^herP^^ This is apportioned by the State Treasurer 
in the same manner as the School Fund interest. In 1872 only 
one-half of the revenue was available. The amount as returned in 
May and apportioned July, 1872, was $57,334.'''"'^ In July, 1873, 
the first following year, the revenue was apportioned for November, 
1872, and May, 1873.2^2^ 

The school mill fund was a tax estabhshed by legislature 1872, 
of one mill per dollar upon all property in the state levied for the 

School support of common schools. The school mill 

Mill Fund f^j^^ fQj. jg^^^ ^j^g gj.g^ yg^j. ^f^gj. j^g establish- 

ment was $224,530. The savings bank fund for that year was 
252^ Ibid., p. 53. 

252^ Ibid., p. 60. 

262-'^ Me. School Report, 1872, p. 10. 



MAINE 295 

$120,000. The Permanent School Fund revenue for that same 
year was $19,000. 

The history of the Maine Permanent School Fund has been 
traced and some of its effects upon the school system have been 
suggested. It might be said in closing that it would seem that in 
view of the rural nature of the population of Maine, and the diffi- 
culty of her present educational situation, some means of increas- 
ing this fund and thereby increasing the leverage which can be 
exerted by state authority upon local communities, would be very 
desirable. Maine has no need to be ashamed of her history of 
school support; on the contrary, she has much to be proud of, and 
it is safe to say that the effectiveness of her present system is largely 
due to the centralizing, though unobtrusive influence exerted dur- 
ing the last half century by the Permanent School Fund. 

Three sources are at present provided by law for increasing the 
principal of the Maine Permanent School Fund: (i) the proceeds 
Present Sources of the sales of public school lands; ^^^ (2) moneys 
of Increase appropriated by legislature for this purpose; ^^^ (3) 

any balance of the school mill fund remaining at the close of the 
financial year.^^^ Both principal and revenue of the fund remained 
stationary from 1885 to 1906, but in this year the principal was 
increased to $445,625 by adding to the former amount ($442,754) 
certain balances unexpended that had accumulated during a few 
years previous.^'*^- ^^'^ 

The investment of the fund is under the direc- 

Management 

tion of the state legislature. The State Treasurer 
keeps the account of it.^"*^ 
Apportionment ^^^ revenue is apportioned annually by the 

Treasurer among the towns upon the basis of 
school population 2^^ (five to twenty-one years 2^^). 

254 Ibid., p. 40, Sec. 127. 

255 Laws of Maine Relating to Public Schools, compiled 1905, p. 39, Sec. 122. 



CHAPTER XXVIII 

MARYLAND 

FREE SCHOOL FUND 

The official titles of the Maryland permanent common school 
fund are Free School Fund and Common Free School Fund.^^^ 
Title. In 1906 the principal amounted to $458,037.70'" 

Condition, 1906 ^j^^ ^^le annual revenue derived therefrom to 
$50,980.14^" which is approximately one and five-tenths (.0146 *) 
per cent of $3,486,235.86,'" the total common school revenue from 
all sources for that year. The principal is invested chiefly in state 
bonds, national bank and railroad bonds and stocks carried at face 
value, though in reality worth more.-" The worth of these secu- 
rities depends upon their intrinsic value and not upon the will of 
the state as do those of many other states.'^^ 

Maryland made her first effort to provide for a permanent com- 
mon school fund by certain legislation in 1812. "The charters 
of the banks in the State were extended to the 

Origin 

year 1835 and they were required to pay annually 
$20,000, which was 'pledged as a fund for the purpose of support- 
ing county schools.' " ^^* The fund was finally established in the 
year 1813 by an act which levied a twenty cent tax on every $100 
of the capital stock of the banks of the state.^^^ The proceeds of 
this bank tax were invested in bank stock, a small portion of 
which was placed to the credit of the fund itself, but most of which 
was placed to the credit of the several counties.^^° In 1837 Mary- 

* Computed. 

257 Statement received Mar. 20, 1907, from B. K. Purdum, Asst. State Supt. of 
Education. 

258 B. C. Steiner, History of Edncatio7i in Maryland, U. S. Bureau of Education, 
Circular of Information, No. 2, 1894, p. 55. 

259 Laws of Maryland, 1813, Chap. 122. 

200 Laws of Md., 1820, Chap. 182. See also Controller's Reports for 1853 and 
following years. 

296 



MARYLAND 297 

land received from the United States $955,838.25, as her share of 

the Surplus Revenue distributed as the result of the act of Congress, 

passed June 2^, 1836.* By Acts of 1836 and 1837 Maryland 

devoted annually to the support of free schools $34,069/°^ the 

interest on $681,387.'*^- This practically amounted to reserving 

this sum as a permanent common school fund or deposit; for, as 

explained in Part I, Chapter III, though this money was a loan to 

the states it has never been recalled and probably never will be. 

Section i. Chap. 295, Laws of 1858, directed the State Treasurer 

to invest $169,979.26 (interest received as due on Maryland's 

loan to the U. S. in the late war) in safe stocks and bonds and to 

distribute the revenue among counties and cities in the same 

manner "as the Free School Fund is now or may hereafter be 

distributed." 

In 1840 the principal from which the $34,069 was derived was 

appropriated to pay state debt interest. The State Controller 

states that it can scarcely be said that this fund 
Loss -^ 

was lost as it was directed that the above $34,069 
be paid from the annual revenue of the Baltimore & Washington 
Railroad, Acts, 1839, Chap. So^^'^^ but Bourne considers the fund 
practically lost and writes that the interest is really raised by taxa- 
tion.^*"' A second loss was occasioned by the changing of state 
banks to national banks and their refusal thereafter to pay the 
twenty cent tax.^^^ 

Present Sources The present constitution and laws of the state 

of Increase make no provision for increasing the principal of 

the Free School Fund. 

The revenue is apportioned by the State Controller among the 

counties of the state and the city of Baltimore 

Apportionment , ■' 

upon the basis of total (school) population (five 
to twenty years of age) .^^"^ 

* See Part I, Chap. III. 

281 Md. Controller's Report, 1877-78, p. VII. 

282 Bourne, E. G., History 0/ the Surplus Revenue of 1S37, pp. 73 and 122. 

283 Md. Controller's Report, 1869, p. vi. 

2*1 Public School Laws of Maryland, 1892, p. 28, Sees. loi, 102. 



298 PERMANENT COMMON SCHOOL FUNDS 

The decision of the State Board of Education is that " the state 
school tax and free school fund are permanently 

Lawful Objects 

intended to pay the salaries of teachers . . . and 
to provide school books and stationary for the children of the 
state." 265 

265 Public School Laws of Md., 1892, p. 8, Sec. 22. 



CHAPTER XXIX 
MASSACHUSETTS 

MASSACHUSETTS SCHOOL FUND 

Massachusetts School Fund is the ofl&cial title of the permanent 
common school fund of Massachusetts.^^' In 1905 the principal 
Title. Con- o^ the fund amounted to $4,880,110.66 and its 

dition, 1905 annual income $219,881.54, approximately, one 

and two-tenths per cent (.0121)* of $18,131,529.01, the total com- 
mon school revenue from all sources for that year. The principal 
is kept as a distinct and separate fund, invested in negotiable 
securities, chiefly city and town bonds and notes and $275,000 of 
railroad bonds.^^*^ 

Peculiar interest is attached to the history of this fund for sev- 
eral reasons. In the first place, in many states, a state perma- 
Features of ^^^^ school fund has preceded and has been the 

Interest chief lever for securing local taxation. In Massa- 

chusetts local taxation, previously permissive, was made compul- 
sory in 1827, seven years before the establishment of the school 
fund.^^^ Second, the establishment of the Massachusetts School 
Fund was the recognition on the part of a state which had succeeded 

Explanation of abbreviations used in foot-notes in Chapter XXIX: 

Rept. = Annual Report of the Board of Education (Bd. Ed.) of Mass. 

Sec. Rept.= Report of the Secretary in Annual Report of the Board of Educa- 
tion of Mass. 

In the earlier reports, the reports of the Sec. and the Bd. are paged separately, 
though bound in one volume. 

29th Rept., p. 2, or 29th Rept., 1864-65, p. 2=Bd. Ed. 29th Rept. for the year 
1864-65, p. 2. 

* Computed. 

266 Statements received Sept. 5, 1906, from Geo. H. Martin, Sec. Mass. State 
Board of Education, and from the Mass. State Treasurer. 

267 Mass. Revised Laws, Chap. 41, Sec. i. 

268 Laws, 1827, Chap. 143, Sec. 4. 

299 



30O PERMANENT COMMON SCHOOL FUNDS 

in securing free schools, that without a state permanent school 
fund no effective school system was possible. Third, scarcely any 
other fund shows so rapid an evolution and such ready adaptive- 
ness to changing conditions, from whatever point it may be viewed. 
These last two statements are supported by many facts among 
which might be noted here, the increase of the limit of the principal, 
originally fixed at one million and increased until it is now five 
million dollars. Fourth, it was never the aim of those endeavor- 
ing to establish or increase the fund to secure a fund of such 
proportions that its revenue would relieve the local community 
of the larger part of the burden of supporting their schools. 
This is shown both by the limit placed upon the principal of the 
fund and by the provision of the law of 1834 which forbade 
any town to receive from the income of the Massachusetts School 
Fund an amount greater than that which it raised by local 
taxation. 

Four means of support of public schools were employed in 

Massachusetts prior to 1834, the year of the establishment of the 

School Fund, as follows: (i) gifts; (2) tuition; (2) 

Public School ' . . 

Support Prior local or town funds, including rents of school 

to (School Fund , , . x , , . _ . „ . , 

lands; (4) local taxation. It is suincient here to 
note that these forms of school support had all existed from colonial 
days, and that they were all local, as opposed to state, in origin.* 
It has been asserted some times that the schools of Massachu- 
setts were universal and free from 1647, but there was no pre- 
vailing or uniform system of supporting schools prior to 1827. 
Local taxation, prior to 1827 was permissive only, and before this 
time each town or district was left to work out its own salvation 
according to its own peculiar will and plan. The year 1827 marks 
for Massachusetts what the year 1867 marks for New York and 
1868 for Connecticut, the legal abolishment of support of schools 
by tuition (rate bills). In that year the towns were authorized 
and empowered, as before, but for the first time directed to raise 
by town tax the money necessary for the support and maintenance 
of such schools as the law required.^®^ 

* For a discussion of early sources of school support consult Part I, Chapter II. 



MASSACHUSETTS 301 

All provisions (up to 1895) relative to this fund have been statu- 
tory rather than constitutional. In January, 1828, '' the Committee 
on Education, of the House of Representatives, 

Steps Leading . ^ 

to Establishment in a report made by the Hon. W. B. Calhoun 
declared 'that means should be devised for the 
establishment of a fund having in view not the support but the 
encouragement of the common schools and the instruction of school 
teachers.'" ^^^ In February, 1828, the same committee specifically 
states that a fund sufficient to support common schools and normal 
schools would injure the school system and decrease the public 
interest in it and cites Connecticut as an example of this, but that 
a fund suflacient to give the towns about one-third the amount they 
themselves raised would be an incentive to interest and effort. A 
bill for the establishment of the Massachusetts Literary Fund 
accompanied this report. This bill dealt, among other things 
with the proportionate amount of the income of the fund to be 
distributed to the several towns. This bill failed to become a law. 
In January, 1833, Mr. Marsh of Dalton, introduced an order into 
the House of Representatives. The House appointed a committee 
" ' to consider the expediency of investing a portion of the proceeds 
of the sales of the lands of this Commonwealth, in a permanent 
fund, the interest of which should be annually applied, as the 
legislature should from time to time direct, for the encouragement 
of common schools.'" ^^^ This order was adopted and was the 
"incipient measure that led to the estabhshment of the Massa- 
chusetts School Fund." ^^^ January 23, 1833, Mr. Marsh sub- 
mitted the report of the committee. The committee had expected 
that " all moneys then in the treasury derived from the proceeds of 
the sales of public lands and the entire proceeds of all subsequent 
sales" were to be devoted to this fund.^^® 

They expected that the fund would amount to $1,634,418.32 
and its annual income to $98,065.09, or about seventy cents to 
each child, five to fifteen years, in the state. This estimate was 
made as follows : ^^^ 

2«9G. S. Boutwell, "Mass. School Fund, Its Origin and History," in Board of 
Education of Mass. Report, 1859, pp. 38-47. 



302 PERMANENT COMMON SCHOOL FUNDS 

Cash and notes on hand, $ 234,418.32 

Avails of 3,500,000 acres of land at 40c. an acre, 1,400,000.00 



11,634,418.32 

After the above bill had been read twice, Mr. Marsh made a 
motion which was carried that the bill be referred to the next legis- 
lature. 

"In 1834 the bill from the files of the last general court, to estab- 
lish the Massachusetts School Fund . . . was referred to a Com- 
mittee on Education. The chairman of the committee, Hon. A. 
D. Foster of Worcester, made a report in February and submitted 
a bill which was the basis of the law" by which the Massachusetts 
School Fund was finally established.'^^ 

Massachusetts ^n March 31, 1834, was passed the law which 

School Fund estabHshed the fund and which reads: 

Established 

"Sec. I. Be it enacted by the Senate and House of 
Representatives in the General Court assembled, and by the authority of the 
same. That from and after the first day of January next (1835) all monies 
in the treasury derived from the sale of lands in the State of Maine and 
from the claim of the State on the government of the United States for mili- 
tary services, and not othei-wise appropriated, together vi^ith fifty per centum 
of all monies thereafter to be received from the sale of lands in Maine, shall 
be appropriated to constitute a permanent fund for the aid and encourage- 
ment of common schools; provided, that said fund shall never exceed one 
million of dollars. 

"Sec. 2. Be it further enacted, That the investment of the monies hereby 
appropriated shall be made by the treasurer and receiver general with the 
approval of the governor and council first obtained. 

"Sec. 3. Be it ftirther enacted, That the income only of said fund shall 
be appropriated to the aid and encouragement of common schools, and that a 
first and equal distribution thereof shall be made to the City of Boston and 
the several towns and districts in the Commonwealth, in such manner as the 
legislature shall hereafter appoint; provided, that there shall never be paid to 
any city, town or district a greater sum than is raised therein respectively for 
the support of common schools." Approved by the Governor, March 31, 
1834.270 

The original sources of the principal of the Massachusetts 
270 Mass. Laws, 1834, Chap. CLXIX. 



MASSACHUSETTS 



303 



School Fund are thus seen to be all moneys in the state treasury 
Original January i, 1835, derived from (i) claims on the 

Capital national government for military services; (2) 

proceeds of the sales of state lands in Maine. The origin of these 
Maine lands may be stated briefly: 

Chapter 287, Acts of Massachusetts 1820, provided that Maine, 
then a district of Massachusetts, be erected and organized into a 
separate state. The joint title of Massachusetts and Maine covered 
about 6,000,000 acres of land, lying in Maine. By the terms of 
the original Act of Separation one-half of this land went to Massa- 
chusetts.^''''' ^ 

As stated above, it had been expected that the proceeds of the 
sales of Massachusetts' Maine lands would amount to $1,400,000. 
Growth of -^t the close of the first year after its establish- 

the Fund ment, 1835, the principal of the fund derived from 

the sale of Maine lands, was $514,906, a little more than half the 
First Source amount permitted by law. The fund's revenue 

MaSeTands, for 1835 was $i6,33i.270a In 1850, fifteen years 
1834-1853 later, the School Fund amounted to $958,921, 2™ & 

almost the limit fixed by the act of 1834. Its revenue for 1850 
was about $45,000."°^ In 1851 "in contemplation of a large sale 
^. . , „ , of lands" the limit of the principal of the fund 

Limit of Fund ^ ^ 

Increased to was changed from $1,000,000 to $i,c;oo,ooo."*'^ 

$1,500,000, 1851 ^ } > ^ }j > 

The Maine lands were exhausted at the close of 

1853, at which time the principal of the School Fund amounted to 

$1,244,284.2™' 

In 1854 provision was made for the increase of the fund by the 

transfer of "such a number of the shares held by the common- 

„ „ „, wealth in the Western Railroad Corporation as 

R. R. Shares. . ^ 

Second Source of will, at the rate of One hundred dollars a share 
Increase, 1854 , . . . . , . , _ , 

increase the prmcipal of the said Fund to the 

amount of one million five hundred thousand dollars." ^^"'^ The 

27oA Mass. Laws, 1819, Chap. 161, Sec. i. 
2'Oa Sec. Report, 1845, P- 22; Report, 1851, pp. 12-14. 

2706 Thirty-ninth Report, 1874-75, pp. 7, 137; for full account see also Sec. 20, 
Report, 1857, p. 70. 
270 c Laws of 1854, Chap. 300; Fifty-fifth Report, 1890-91, p. 189. 



304 PERMANENT COMMON SCHOOL FUNDS 

law of 1854 further provided for increasing the School Fund 
capital from the revenue itself. Previous to this time the entire 
Third Source annual Incomc of the fund was distributed among 

Fund^^Own ^he citics and towns for the direct "aid and 

Income, 1854 encouragement of common schools," while appro- 
priations for general educational purposes * were paid out of the 
moiety of the proceeds of sales of public lands, and if these were 
not sufficient, the deficiency was made up by a payment from the 
invested principal of the School Fund.^^"^ Briefly stated then, 
these general educational expenses were paid, 1846 to 1854, out of 
proceeds which in some cases should have contributed to the prin- 
cipal, or out of the principal itself. The law of 1854 met both of 
these conditions, and so provided for a double means of increasing 
the fund. It provided that the annual income of the School Fund 
should be divided into two halves. The first half to be paid to 
towns and cities for the use and support of common schools. The 
second half was devoted to two uses: (i) it should be used to pay 
all general educational expenses not otherwise specially provided 
for by law; (2) any balance of this half was to be added to the 
principal of the fund until the principal should amount to 
$2,000,000.'^'^'' As a result of these different provisions for its in- 
crease, the fund amounted in 1856 to $1,627,467.-™^ This was 
nearly a million dollars increase since 1845 when its principal was 
only $789,389"'"' and its annual income was $28,966, while in 
1855-56 its income was $90,566.-^'^^ 

In 1859 it was provided that "all the avails of the moiety of the 
sales of certain Back Bay lands (made land)""^' be added to the 

* General educational expenses included chiefly 270£? (j) salary Sec. Bd. Ed.; 
(2) salaries agents Bd. Ed.; (3) support of three normal schools and four nor- 
mal art schools; (4) teachers' institutions; (5) printing reports; (6) building and 
repairing normal school-houses and boarding-houses; (7) incidental expenses, 
Board of Education, whose members act without salary. 

270d Thirty-ninth Report, 1874-75, p. 7. 

2706 Laws, 1819, Chap. 219, Sec. 2. 

270/ Laws, 1854, Chap. 300, Sec. 3. 

270(7 Sec. 20, Report 1857, P- 7°- 

270/! Secretary's Report, 1845, P- 33- 

2/0? Mass. Resolves, 1852, Chap. 79, 2d Resolve. 



MASSACHUSETTS 305 

Massachusetts School Fund." ^'"* The sum added to the princi- 
pal of the fund from the proceeds of the sales of these lands 
Fourth Source 1859-64 was $456,930.^'^°' This was"lessthan 
Back*^BTy^Lands, fifteen per cent of the estimated profits of the 
1859-1864 ' enterprise." 270 J xhe entire profits of this land, 

with the exception of $505,000 was originally pledged to the School 
Fund by the legislation of 1859.^^°"' 

The School Fund amounted to $2,087,107.01, January i, 1882."°" 
During this year about $624,000 was added to the principal ^''^ ' 
Fifth Source ^^ " ^"^ exchange of Boston & Albany Railroad 

of Increase. stock for bonds of the same corporation at a pre- 

$024,000 from ^ ^ 

Stock Exchanged mium." '"^° December ^1,1882, the principal had 

for Bonds, 1882 ^ ' . ^ ^ 

reached $2,711,263 and its net income for that 
year was $137,465.34. Chapter 335, Section i, Acts of 1890, pro- 
General Provision vidcd that " Any moneys which may hereafter be/ 
for Increase, 1890 j-gceJved into the treasury of the commonwealth 
from the general government, the disposition of which is not other- 
Seventh and wise provided for, shall be paid into the Massa- 
of^in?rease.'"' chusctts School Fund." In 1891 the principal 
u^^s. Dir™t' °^ ^^ ^^^"^ ^^^ increased " by the United States 
Tax, 1891 -y^aj. claims collected, amounting to $12,043.73 
and by $696,407.88 from United States direct tax of 1861, re- 
cently refunded," a total of $708,451.61,""' making the principal 
of the fund $3,665,761.88 in 1891, and its income $138,625.2'^°° 

An important means of increasing the principal of the School 
Fund was provided for in 1894 by Chapter 90, Resolves of 1894, 

which ^'Resolved, That there shall be paid into 

Ninth Source. ^ 

Annual Increase the Massachusetts School Fund out of the treas- 

of $100,000, 1894 , . , r u 

ury of the commonwealth, the sum of one hun- 
dred thousand dollars annually, until the principal of said fund 
shall amount to the sum of five million dollars." This annual 
amount was first added to the principal in the school year, 1893-94, 

270fc Acts, 1859, Chap. 154; Sixty-fourth Report, 1899-1900, p. 266. 

270 J Fifty-seventh Report, 1892-93, p. 102. 

270TO Secretary's Report, 1866, p. 66, gives full account. 

z'O'z Sec. 46, Report, 1881-82, p. 58. 

2700 Sixtieth Report, 1895-96, p. 214. 



3o6 PERMANENT COMMON SCHOOL FUNDS 

when the principal amounted to $3,770,548.11 and its annual in- 
come to $167,210.11.2^°^ 

In 1893 a chain of action was begun^^°«' ^^^^ by which the income 
of the School Fund was supplemented in 1901 from the excess 
Income of income of the Fitchburg Railroad Securities 

InS!a!ei'l5,ooo Loan Sinking Fund^^o^ by $150,000, and which 
Annually ^Qj Continue to add $25,000 annually to the in- 

come of the School Fund until 1937 provided this legislation re- 
mains undisturbed.2^° ' In 1893 it became necessary for the state to 
take some action for the proper disposal of the securities in several 
sinking funds pledged for the redemption of state bonds, which 
would become due in 1894. Among these securities were bonds 
of the Fitchburg Railroad Company, amounting to $5,000,000. 
Owing to the financial condition of the country at this time, it did 
not seem best to offer these bonds for sale. Therefore under the 
authority of the legislature, the treasurer and receiver-general 
issued scrip known as the Fitchburg Railroad Securities Loan, to 
the amount of $5,000,000.^^"^ For the redemption of this scrip 
there was established a sinking fund, known as the Fitchburg 
Railroad Securities Loan Sinking Fund, into which were put the 
$5,000,000 worth of Fitchburg Railroad Company bonds, and also 
50,000 shares of Fitchburg Railroad common stock nominally 
worth $5,000,000, but regarded as almost if not entirely value- 
less."o« 

Provision was made in 1893 that the excess of the income of the 
aforesaid sinking fund be assigned not to the principal, but to the 
income of the Massachusetts School Fund.^"^*^* By the sale, as 
provided for by Chapter 426, Acts of 1900, of the 50,000 "previously 
unproductive shares of common stock of the Fitchburg Railroad 
Company to the Boston & Maine Railroad Company, this sinking 
fund acquired $5,000,000 worth of gold bonds bearing three per 
cent interest. The productive securities of the fund were thus 

270P Fifty-eighth Report, 1893-94, pp. 126 and 436. 

2'09 Acts of 1893, Chap. 408. 

2'0'' Acts of 1901, Chap. 223. 

270 « Sixty-fifth Report, 1900-01, pp. 126-128, 



MASSACHUSETTS 307 

raised to $10,000,000, double the amount required for the fund. 
The legislature, on April 2, 1901, authorized the transfer of these 
Boston and Maine gold bonds from the Fitchburg Railroad Securi- 
ties Loan Sinking Fund to such other sinking funds as might be 
directed by the governor and council.^'^" *■ The transfer was not 
made until the bonds had remained a year in the Fitchburg Railroad 
Securities Loan Sinking Fund, and not until the excess of the in- 
come payable to the income of the School Fund had risen to 
$175,000. Since the annual amount derived from this excess and 
added to the School Fund income was about $25,000 for several 
years the additional sum received, 1901, from the excess for 1901, 
amounted to $150,000. One-half of this $150,000 was paid to the 
School Fund towns January, 1902, in addition to the half of the 
income of the School Fund. 

As already noted the entire profits of the sales of the Back Bay 
lands with the exception of $505,000 were originally pledged to 
Loss and the School Fund by the legislation of 1859.^'"* 

Diversion « jj^^^j ^j^jg legislation been permitted to stand, the 

School Fund would have been increased to five million dollars," 
but after 1864 nothing was added to it from this source.^'^^'^ The 
amount added 1859-64 was $456,930,^'°* "less than fifteen per 
cent of $3,066,652, the estimated profits of the enterprise." ^^o i in 
1861 a diversion from the fund was made "when $232,790 was 
given in the form of (Back Bay) land to the Massachusetts Institute 
of Technology and the Boston Society of Natural History." 2™* 
Other diversions were made.^^*^ ™ Finally, from 1864 on, all profits 
of Back Bay lands were diverted from the School Fund to a sinking 
fund created for the payment of scrip issued by the state in 1864 
Effect of Civil to meet its Civil War claims and debts. The 

ar on Fund necessity of providing means for the payment of 
the large sums spent by the state during the late Civil War for re- 
cruiting and transporting soldiers, led the legislature to provide 
for the creation of a fund by the issue of state scrip, not to exceed 
ten million dollars, called the Massachusetts Bounty Fund.^^"" The 
legislature also created a sinking fund for the payment. Provision 

27o« Sec. Forty-sixth Report, 1S81-S2, p. 58. 



3o8 PERMANENT COMMON SCHOOL FUNDS 

was made that all further profits of the Back Bay lands should be 
diverted to this sinking fund as soon as the School Fund shall have 
reached the amount of $2,000,000^™" and after 1864 the School 
Fund was not further increased from this source, although it was 
not until January i, 1866, that the fund amounted to $2,000,000/^""' 
the limit set by the law of 1854. 

Massachusetts received $1,338,173.58 as her share of the Surplus 
Revenue distributed by the federal government as a loan to the 
United States States in 1 83 7. Massachusetts distributed two- 
f,"7ot''ed?r^°"^ thirds (except $2,500) of her share among the 
Local Funds 271 towns, authorizing them to " apply the money so 
deposited with them or the interest upon the same, to those objects 
of public expenditure for which they may now lawfully raise and 
appropriate money, and to no other purpose." ^^^ "Many of 
the towns bestowed the Surplus Revenue Fund or its income on 
the public schools, but, the records of town grants being inacces- 
sible, it is impossible to show the entire amount expended in that 
way." Because these are local funds and because the scope of this 
work includes only permanent state funds it is suflScient to say here 
that in 1902 the aggregate principal of Massachusetts local school 
funds amounted to $1,121,987.55, and the annual income from the 
same to $55,172.21.^^^ 

The act creating the School Fund directed that it be invested 

by the Treasurer and receiver-general of the commonwealth, 

subject to the approval of the governor.^™ This 

Management of . 

Massachusetts form of management continued from 1834 to 

School Fund o^^t r-^^ ^ <• ^ \ ^ 1 1 

1866. in 1866, as the fund had accumulated to 
$2,000,000 and the duties of the treasurer had greatly increased, 
it was deemed wise to associate with him an executive ofl&cer of 
the Board of Education to aid in the investing and management of 
the fund. Consequently, in this year, the management was trans- 

270U Mass. Acts, 1864, Chap. 313, Sec. 3. 
^^OJ* Sec. Thirtieth Report, 1866, p. 69. 

2^^ J. Eaton, National Aid to Education, U. S. Bureau of Education, Circular of 
Information, No. 2, 1879, P- 22. 
-^2 Mass. Laws, 1837, Chap. 85. 
2'^ Report, 1900-01, p. 127. 



MASSACHUSETTS 309 

ferred into the hands of special commissioners, the secretary of the 
Board of Education and the treasurer and receiver-general.^^"* 
This is the present (1905) form of management.^^^ 

"The secretary of the Board of Education and the treasurer and receiver 
general shall be commissioners, who shall invest and manage the fund and 
report annually to the general court the condition and income thereof. The 
premiums on any securities purchased for said fund, to an amount not exceed- 
ing in any one year fifty thousand dollars, may be paid from any money in 
the treasury of the commonwealth, not otherwise appropriated. All invest- 
ments shall be made with the approval of the governor and council." ^^^ 

Four sources are at present provided by law to increase the 
principal of the School Fund: (i) portions of School Fund revenue 
Present Sources forfeited by towns ovi^ing to their failure to fulfil 
of Increase conditions of participation; "^ (2) moneys received 

into the state treasury, disposition of which is not otherwise pro- 
vided for (provided, 1890) ; ^^^ (3) annual appropriation of $100,000 
to be continued until the principal of the School Fund amounts 
to $5,000,000 (provided, 1894);^''^ (4) $25,000 to be added annually 
until 1937, to the income of the School Fund (not the principal) 
from the excess income of the Fitchburg Railroad Securities Loan 
Sinking Fund.^""^ 

,„, Chapter 456 of the Acts of 190^ provides as fol- 
Apportionment 281 r -+0 y o i- 

lows: 

"Sec. I. The annual income of the Massachusetts School Fund shall, without 
specific appropriation, be apportioned and distributed for the support of the 
public schools in the following manner: I. Every town which complies with all 
laws relative to the distribution of said income and whose valuation of real 
and personal property, as shown by the last preceding assessors' valuation 
thereof, does not exceed one-half million dollars, shall annually receive five 

"*Acts, 1866, Chap. 53, Sec. i. 
-'^ Rev. Laws, Chap. 41, Sec. 3. 

27S Pub. Stats, of Mass. relating to Public Instruction, Including Laws in Force, 
1892, p. 55, Chap. 46, Sec. 11; Abbreviated Stats., P. I., 1892. 
^" Mass. Acts, 1890, Chap. 335, Sec. i. 
"^Mass. Resolves, 1894, Chap. 90. 

^'^ Report Mass. Board of Education, 1S99-1900, pp. 19, 264 ff. 
2" Mass. Acts, 1903, Chap. 456. 



310 PERMANENT COMMON SCHOOL FUNDS 

hundred dollars; but if its rate of taxation for any year shall be eighteen dollars 
or more on a thousand dollars it shall receive seventy-five dollars additional. 
II. Every such town whose valuation is more than one-half million dollars and 
does not exceed one million dollars shall receive three hundred dollars; III. and 
every such town whose valuation is more than one million dollars and does not 
exceed two million dollars shall receive one hundred and fifty dollars; IV. and 
every town whose valuation is more than two million dollars and does not ex- 
ceed two and one-half million dollars shall receive seventy-five dollars. The re- 
mainder of said income shall be distributed to towns whose valuation does not 
exceed two and one-half million dollars, and whose annual tax for the support 
of public schools is not less than one-sixth of their whole tax for the year, as 
follows: Every town whose school tax is not less than one-third of its whole 
tax shall receive a proportion of said remainder, expressed by one-third; 
every town whose school tax is not less than one-fourth of its whole tax shall 
receive a proportion expressed by one-fourth; every town whose school lax is 
not less than one-fifth of'its whole tax shall receive a proportion expressed by 
one-fifth; and every town whose school tax is not less than one-sixth of its 
whole tax shall receive a proportion expressed by one-sixth. All money ap- 
propriated for other educational purposes, unless otherwise provided for, shall 
be paid from the treasury of the commonwealth. 

"Sec. 2. The income of said fund which has accrued on the thirty -first 
day of December in each year shall be apportioned by the commissioners of 
the Massachusetts School Fund in the manner provided for by section one of 
this act, and shall be paid to the several towns on the twenty-fifth day of 
January thereafter." 281 

The law permits a city or town school committee to expend not 

more than twenty-five per cent (.25) of their share of School Fund 

revenue to purchase books of reference, maps, 

Objects , ^ , . , 1 1. 1 

and apparatus; the remamder must be applied 
to the support of public schools.^^^ The term "support of public 
schools" is defined by law to include the following eight classes of 
expenditure:^*^ (i) teachers' wages; (2) transportation of school 
children; (3) fuel; (4) care of school premises; (5) clerks, truant 
officer, etc.; (6) superintendents of schools; (7) text-books and 
supplies; (8) school sundries. No part of the income of the 
Massachusetts School Fund shall be used for payment of the com- 
pensation or expenses of members of school committees.^^'* 

282 Mass. Stats., P. I., Chap. 43 (1892), Sec. 6, p. 26; see note 276. 

283 Mass. Acts, 1900, Chap. 175, p. iii. 
28* Mass. Acts, 1904, Chap. 107, Sec. 2. 



MASSACHUSETTS 311 

No apportionment of School Fund revenue can be made to any 
town or city which fails: (i) to raise a local school tax of at least 
Conditions of $3-oo for each inhabitant, five to fifteen years of 
Participation ^^gg. ^g) to submit the school returns required by 

law; (3) to comply with the laws regarding truancy; (4) to maintain 
the public schools required by law.^*^ 

Chapter 107 of the Acts of 1904, provides as follows: Section i. 
No town shall receive any part of the income of the Massachusetts 
School Fund unless it shall have complied, to the satisfaction of the 
Board of Education with all laws relating to the public schools.^^^ 

ii85 Ibid., Sec. I. 

286 Stats., P. I., 1892 (cf. note 276), p. 27, Chap. 43, Sec. 5. 



CHAPTER XXX 

MICHIGAN 
PRIMARY SCHOOL FUND. SWAMP LAND FUND 

Michigan has two "accounts" of permanent common school 
funds, known respectively as the Primary School Fund,^®^ and the 
Titles. Swamp Land Fund.^^* "The Primary School 

Condition Fund is the account of the proceeds received from 

the sales of primary school lands. The state pays seven per cent 
annually upon this account, whence it is often called the Seven Per 
Cent Fund, The constitution provides that this fund be kept a 
permanent fund which can never be decreased; nevertheless, the 
Primary School Fund contains no money. All moneys received by 
the state in whole or in part payment upon school lands sold are 
used by the state for general purposes." ^^^ These statements apply 
equally to the Swamp Land Fund, concerning which the law pro- 
vides that "all moneys received on such sales (sales of lands belong- 
ing to school swamp land fund) . . . after deducting the expenses 
as aforesaid, shall be used and applied to the payment of the out- 
standing indebtedness of the state." ^^" The state pays five per 
cent annually on this "account," ^^° whence the fund is commonly 
called the Five Per Cent Fund. The Primary School Fund is a 
perpetual fund fixed by constitution, whereas the swamp land fund 
is a statutory fund, and can be changed by the legislature.-^^ The 
condition of these two funds in 1903 was reported as follows :^^^ 

Primary School Fund: 

Proceeds paid in $4,193,642.40 

Due from purchasers 77)377-45 

Total amount of fund available for interest $4,271,019.85 

287 Constitution of Michigan, Art. XIII, Sec. 5. 

28S Report Supt. of Public Instruction, of Michigan, 1903, p. 24. 

289 Ibid., pp. 22, 23. 

290 Acts of Mich., 1887, No. 142, Sec. 5. 

291 Report Mich. Supt. of Public Instruction, 1903, pp. 27, 31. 

312 



MICHIGAN 313 

Unsold lands, 46,975.33 acres estimated at $5 per acre . . . $234,876.65 

Total prospective proceeds $4,505,896.50 

Swamp Land Fund: 

Proceeds paid in 919,365.70 

Due from purchasers 15,466.82 

Total amount of fund available for interest $934,832.52 

Unsold lands, 35,625.60 acres estimated at $5 per acre .... 178,128.00 

Total prospective proceeds $1,112,960.52 

The total interest-bearing proceeds (principal?) of these two 
funds combined is therefore $5,201,852.37, and the total prospective 
proceeds (principal?) $5,614,856. 

The income derived from these two funds for the same year was 
as follows: 

Interest on Primary School Fund (Seven Per Cent Fund) . . . $345,447.91 

Interest on Swamp Land Fund (Five Per Cent Fund) .... 52,366.62 

Interest from purchasers 6,061.39 

Received from trespassers 2,243.90 

Total Income $406,119.82 

Total annual receipts for common schools, this same year, 
derived from all sources : $8,871,294.56292 

Per cent of total revenue derived from "permanent funds" ac- 
counts, approximately (.0457)* four and six-tenths per cent. 

In 1804 when Michigan was yet a district of the territory of Indi- 
ana, Congress reserved for the use of the public schools, section 
numbered sixteen in each township. The total 

Origin ^o^ '- 

area of the lands thus reserved amounted to 
1,067,397 acres.^*' This grant was recognized when Michigan was 
organized into a separate territory (1805). Provision was made for 
the establishment of the Primary School Fund by section 2, arti- 
cle X, of the constitution adopted by the constitutional convention, 
1835,^^^ and this provision became effective and the fund established 

* Computed. 

292 Ibid., p. 167. 

293 For account of origin of these funds see Report Mich. Supt. of Public In- 
struction, 1903, pp. 18-24; also Report 1899, p. 22. 

291 Roberts, Mich. Rev. Stats., 1S38, p. 42. 



314 PERMANENT COMMON SCHOOL FUNDS 

upon the state's admission into the Union, 1837. The Swamp Land 
Fund was established by an act of legislature, 1858, which provided 
that after deducting the expenses of sales, fifty per cent of all pro- 
ceeds of all former and all future sales of swamp lands should 
constitute a fund to be "denominated a primary school fund" and 
the annual interest thereof at five per cent should be appropri- 
ated and distributed in like manner as the Primary School Fund 
interest.^^^ 

The history of these swamp lands may be briefly told: In 1812 
Congress set aside two million acres of land in Michigan as bounty 
land to non-commissioned officers and soldiers who would enlist 
in the war between the United States and Great Britain.^^^ Sur- 
veyors declared these lands swamps and worthless. Other lands in 
Illinois and Missouri were given to the soldiers, and in 1850 Congress 
gave back to Michigan the worthless lands; 5,838,775 acres of 
swamp land were patented to the state prior to 1899, and of the 
proceeds, $846,778, were devoted to the Five Per Cent Fund.^^^ 

The minimum price originally fixed by the legislature in 1837 
upon primary school lands was eight dollars per acre. "Owing 
to the hard times following the financial panic 
of 1837, many who purchased the lands appealed 
to the state legislature for a reduction of the minimum price. As 
a result, the minimum price (of primary school lands) . . . was 
thanged in 1840 ... to five dollars per acre. In 1842 a still 
further reduction was made, so that in December, 1842, the fund 
had shrunk from $739,638.01 to $359,809.41." ^^^ When we con- 
sider that the moneys belonging to the Primary School Fund and 
the Swamp Land Fund have been used for general expenditures and 
payment of state debts we see that these funds instead of lessening 
the taxation for the support of schools actually increase it, but 
Michigan has escaped the full weight of the burden that would be 
felt if the interest on these funds were paid out of a direct state tax. 

295 Laws of Mich., 1858 (No. 31), Sec. 5, p. 171; Report Supt. of Public Instruc- 
tion, 1889, p. 22, gives a full account. 

298 Statutes at Large, Vol. II, p. 669; Act of Dec. 24, 1811, Chap. 10, Sec. 2; and 
p. 728, Act of May 6, 1812, Chap. LXXVII, Sec. i. 



MICHIGAN 315 

Section I of article XIV of the constitution provides that " all specific 
taxes except those received from mining companies of the upper 
peninsula, shall be apphed in paying the interest of the primary 
school, university and other educational funds, and the interest and 
principal of the state debt in the order herein recited, until the ex- 
tinguishment of the state debt, other than the amount due to edu- 
cational funds, when such specific taxes shall be added to and con- 
stitute a part of the Primary School Interest Fund (i. e., be added 
to the interest derived from all permanent primary school funds)." 

The constitution provides for the increasing of the principal of 
the Primary School Fund from three sources c^^'' the proceeds (i) 
Present Sources ^f sales of all lands that have been or may here- 
of Increase g^f^-gj. ^^ granted to the state for educational pur- 
poses; (2) of all lands or other property given by individuals or 
appropriated by the state for like purposes; (3) of intestate lands 
escheating to the state. 

All educational funds in Michigan are managed by the legis- 
lature. The Superintendent of Public Instruction transmits plans 
for the management to the Governor, who in 
turn transmits them to the legislature.^^^ 

The interest of the Primary School Fund is apportioned semi- 
annually by the Superintendent of Public Instruction among the 
towns and cities of the state in proportion to 

Apportionment ^ ^ r r 

their school population (five to twenty years) .^^^ 

The combined interest of the Seven Per Cent Fund and the Five 

Per Cent Fund is known as the Primary School Fund interest. It 

_ can be applied to only one object; — the payment 

of the wages of teachers in public schools.^*^" 

In order to share in the Primary School Fund interest, a district 

Conditions of must have been maintained for at least five 

Participation months the preceding year, a school taught by a 

legally qualified teacher.^^^ 

297 Constitution of Michigan, 1850, Art. XIII, Sees. 2, 3. 

298 Mich. Gen. School Laws, 1903, Sec. 17. 

299 Ibid., Sec. 20. 

300 Ibid., Sec. 54. 

301 Report Supt. of Public Instruction, of Mich. 1903, p. 29. 



Management 



CHAPTER XXXI 

MINNESOTA 
PERMANENT SCHOOL FUND. SWAMP LAND FUND 

Minnesota possesses two public permanent funds devoted to the 
support of common schools, the oflScial titles of which are Perma- 
Tities. iisnit School Fund"^^ and Swamp Land Fund.^*^^ 

Condition, 1908 Of the Swamp Land Fund only one-half is a com- 
mon school fund; the other half is devoted to the support of other 
state educational and charitable institutions.^"^ The condition of 
these funds in the year ending July 31, 1908, is reported as follows: 

Invested principal of half Swamp Land Fund $ 621,636.17304 

Invested principal of Permanent School Fund 19,709,383.91305 

Total invested principal $ 20,331,020.08 

Estimated surface value of 1,015,187.46 acres of unsold Perma- 
nent School Fund lands 307 5jS4S!954-32 

Estimated value of ore products of sameSoe , 100,000,000.00 

Total prospective value of Permanent Common School 
Fund and Half Swamp Land Fund, excluding value 
of unsold swamp lands $125,876,974.40 

The principal of the Permanent School Fund is invested in or 
secured by state bonds and certificates of indebtedness, municipal 
bonds, and bonds of foreign states.^°^ The rent of unsold school 

302 Laws of Minn. Relating to the Public School System, edited by J. W. Olsen, 
1901, p. 43, Title 9. 

303 Minn. Gen. Laws, 1907, Chap. 385. 

304 Advance Kept. Minn. State Aud., Biennial Report, 1907-08, p. ix. 

305 Ibid., p. vii. 

306 Ibid., p. xxxvi. 

307 Data from records of State Auditor furnished F. H. Swift by Dept., Dec. 28, 
1908. 

308 Data furnished F. H. Swift, Sept. 27, 1906, by J. W. Olsen, Minn. State Supt. 
of Public Instruction. 

316 



MINNESOTA 317 

lands is added to the principal of the fund ^^^ and is not, therefore, 
distributed annually as in some other states. 

Income of Permanent School Fund 1907-08 $686,432.55307 

Income of Half Swamp Land Fund 1907-08 18,637.16307 



Total income of public permanent common school funds $705,069.71807 

The total receipts for common schools for the year 1907-08, includ- 
ing the balance on hand at the beginning of the year, amounted to 
$14,919,015.^°^ Of this, therefore, approximately four and seven- 
tenths per cent (.047)* was derived from the income of the Perma- 
nent School Fund and Swamp Land Fund. 

Section 18 of the Congressional Act passed March 3, 1849, ^o 

establish the territorial government of Minnesota reserved sections 

sixteen and thirty-six in each township for the use 

Origin of ^ 

Permanent of common schools.^^" The amount of land thus 

School Fund , , ^ m ^ 

reserved amounted to 2,969,990 acres,^" or (.055) 
five and five-tenths per cent of the area of the state. The Perma- 
nent School Fund was provided for by the first constitution adopted 
by the state, that of May 11, 1858, which became effective upon the 
admission of the state into the Union.^^^ 

The origin of the federal grant of swamp lands to the states of 
the Union has been described in Chapter III. The area and esti- 
Origin of Minn, niated value of the swamp lands thus far granted 
Swamp Land Fund ^q Minnesota could not be ascertained at the state 
department. As stated in Chapter III, the Swamp Land Grant 
is an indefinite grant covering " all the swamp and overflowed lands 
rendered thereby unfit for cultivation and remaining unsold at the 
date of the grant." The last published federal tables, those of 
1896, reported that prior to January i, 1896, there had been 
granted to Minnesota 4,738,549.78 acres of swamp lands. An 
amendment to the constitution, article VIII, section 2, adopted 1881, 

* Computed. 

309 Data furnished F. H. Swift, Dec. 28, 1908, by Minn. State Dept. of Public 
Instruction. 

310 Organic Act of Minn., Gen. Stats, of Minn., 1866, pp. 14-21; also Report 
Minn., Dept. Public Instruction, 1S78, p. 6. 

su Constitution of Minn., 1858, Art. VIII, Sec. 2. 



3i8 PERMANENT COMMON SCHOOL FUNDS 

provided that of all the swamp lands then held or which might 
thereafter accrue to the state one-half shall be appropriated to the 
" Common School Fund" and one-half to the educational and char- 
itable institutions of the state, the principal of the funds derived 
from the sale of such swamp lands to be forever preserved inviolate 
and undiminished. 

It will be seen that the provisions of this amendment set apart 
one-half of the Swamp Land Fund as a second permanent public 
common school fund. Despite this amendment the Swamp Land 
Fund was not divided and nothing was derived from it for the sup- 
port of common schools until the passage of an act in March, 
1907.^°^ As the result of this act, since 1907 one-half the income 
from the Swamp Land Fund has been devoted to the support of 
common schools ^^'^ and one-half credited "to the appropriation for 
the support of the several state educational and charitable in- 
stitutions." 

In Minnesota the swamp lands were devoted originally to state 

institutions, not to the schools. In 1865 a law was passed direct- 

ing tha|s525,ooo acres of swamp lands be reserved 

One-half Swamp for the benefit of the following state institutions: 

Lands Devoted " 

to Common 100,000 acres each for the Insane Asylum, School 

for Deaf, Dumb and Blind, State Prison; 75,000 
acres for each of the three normal schools, Winona, Mankato, 
and St. Cloud.^^^ Subsequently it was provided that after the 
swamp lands appropriated to other purposes shall be selected, the 
Commissioner shall select and set apart the remainder of such lands 
for the support of a Soldiers' Orphan Asylum. In 1878 the Super- 
intendent of Public Instruction suggested that in view of the fact 
that the Soldiers' Orphan Asylum had been closed, the lands set 
apart for it be in the future given to the normal schools.^^^ 

Minnesota "has never lost a dollar of her permanent school 

fund." ^°* The state had borrowed (prior to 1906) 

$6,657,479.96,^°* over one-third of the principal. 

The interest on this is paid out of state taxes.^°* As pointed 

312 Minn. Gen. Laws, 1865, Chap. 5. 

313 Report Minn. Supt. of Public Instruction, 1878, p. 75. 



MINNESOTA 319 

out in Chapter V and elsewhere this is a poHcy pursued by other 
states. For many reasons state bonds are one of the safest forms 
of investments, and when the school land moneys accumulate 
in the treasury the matter of investing such large sums becomes 
exceedingly difficult. Yet to use the moneys derived from the pro- 
ceeds of the sales of school lands and to substitute for them certifi- 
cates of indebtedness or even state bonds has resulted in transform- 
ing the permanent school fund of many a state into a burden rather 
than an aid. The purpose of these funds was clearly to lessen the 
taxation. The moneys are used up for internal improvements or 
other state purposes and then the people are taxed to pay the 
interest on the substituted or purchased securities. Such a policy 
has frequently resulted in extravagance and reckless expenditure 
on the one hand and increasing burdens of taxation for coming 
generations on the other hand.* In conclusion it should be stated 
that Minnesota's management of her Permanent School Fund has 
been universally regarded as wise, efficient, and exemplary. Its 
method of caring for and selling its lands and of creating one 
state instead of many township funds were epoch-making policies 
in the history of pubhc permanent school funds in the United 

States.! 

The sources at present provided for increasing the principal of 
the fund are the proceeds from (i) the sale (2) or rent of school 
Present Sources lands, (3) the sale of grass or timber on such 
of Increase lands,^^'* (4) royalties on iron ore taken from school 

lands, (5) profits on sales of bonds.^°^ 

The investment of the fund is in the hands of a " Board of Invest- 
Present ment consisting of the governor, state auditor 

Management ^^^ g^^^g treasurer." ^^^ 

The revenue is apportioned by the State Superintendent of Public 

* On this point compare the accounts of credit funds in Chapters I and 
V. 

■]• For an account of the importance of Minnesota's policies consult Manage- 
ment, Chapter V. 

31* Report Dept. of Public Instruction of Minn., 1878, p. 37; Laws of 1901 pro- 
vide no other means. 

315 Minn. School Laws, 1901, sees. 101-105. 



320 PERMANENT COMMON SCHOOL FUNDS 

Instruction among the counties ''in proportion to the number of 
scholars in each township five to twenty-one years 

Apportionment 

of age,^^^ who have been enrolled in attendance 
forty days.^^^ 

The objects for which the revenue of the Permanent School Fund 
may be expended are not specified by law, but it cannot be used 

for sectarian schools ^^^ and in the expenditure of 

Objects ^ 

it, teachers' wages have the preference.^^^ 
The conditions which must be fulfilled in order to share in the 
revenue of the Permanent School Fund are four in number, and 
_ may be summarized as follows: (i) maintenance 

Present ^ ^ ' 

Conditions of of a school at least five months; ^"^ (2) the school 

Participation ^^ r -\ i ion 

must be taught by a legally quahlied teacher;"*'^" 
(3) submission of returns required by law;^"° (4) provision of 
regular and systematic instruction in physiology and hygiene.^^^ 

316 Constitution of Minn., Art. VIII, Sec. 2. 

317 Minn. School Laws, 1901, Sec. 164. 

318 Constitution of Minn., Art. VIII, Sec. 3. 

319 Minn. School Laws, 1901, Sec. 72. 

320 Ibid., Sec. 164. 

321 Ibid., Sec. 367. 



CHAPTER XXXII 

MISSOURI 

PUBLIC SCHOOL FUND, TOWNSHIP FUND, COUNTY PUBLIC SCHOOL 
FUND, SPECIAL DISTRICT FUND 

Missouri has four permanent common school funds or classes 
of funds known respectively as the Public School Fund; ^^^ County 
Title. Public School Fund; ^^^ Township School Fund; ^24 

Condition, 1902 g^^^ Special District Fund.^^^ The principal of 
these funds is as follows: ^^'^ Pubhc School Fund, $3,159,123; 
County P.ublic School Fund, $6,002,426; ^^^ Township School Fund, 
$2,301,622; Special District Fund, $92,385. The total principal 
of the permanent common school funds amounts, therefore, to 
$11,566,556; the annual income reported to be derived from the 
same in 1902 is $638,833,^^^ approximately seven and nine-tenths 
per cent of $8,113,509,"^ the total pubhc school revenue that year. 

It would be difficult to state in what year the first permanent 
Origin Special District Fund was established. These 

District Funds funds are local funds which have been created 
at different times by gifts, devises, bequests, special grants or leg- 
islation. 

In 1812, while Missouri was yet a territory, "Congress ordered 
that all lands not of private ownership be reserved for school pur- 
poses in a dozen of the larger villages. Missouri became a state 
in 1821." ^^^ In 1839 an act was passed for the estabhshment of 
a system of common schools. One provision of this act declared 

322 Revised School Laws of Mo., 1903, p. 56, Sec. 9819. 

323 Ibid., p. 58, Sec. 9824. 

324 Ibid., p. 59, Sec. 9828. 

325 Report Mo. Supt. of Public Schools, 1884, p. 15. 

326 Ibid., 1902, p. 28. 

327 A. D. Mayo, The American Common School in the Southern States, 1790- 
1840; Report U. S. Commissioner of Education, 1895-96, I, p. 330. 

321 



322 PERMANENT COMMON SCHOOL FUNDS 

that all towns and neighborhoods to which the United States Gov- 
ernment had granted special donations of school lands in 1812 
might be incorporated for school purposes.^^* 

Upon admission into the Union, section numbered sixteen was 

granted and reserved in each township of the state for the support of 

.. ^ , schools, the asgresrate area being I 208,120 acres.^^^ 

Township Funds > ho & o > j 

In 1834-35 the legislature provided for the survey 
of these school lands and for the regulation of the sale of the same.^^'^ 
In 1839 supplementary provisions were made respecting the sale.^^^ 
The Revised Statutes of 1845 contain no provision requiring that 
the proceeds be invested permanently. This provision appears, 
however, in the Revised Statutes of 1866, Chapter 46, section 66. 

The Public School Fund was established by legislative act 
February 6, 1837.^^*' The original capital consisted of the pro- 
Origin Public ceeds of seventy-two sections (46,080 acres) of 
School Fund g^ijj^g i^j^^g ^^^ $382,355, Missouri's share of the 

surplus revenue distributed by United States in 1837.^^^'* 

On February 9, 1839, it was provided that the proceeds of fines, 
forfeitures, etc., collected within the county, should be paid into 
County the county treasury for the County School Fund,^^^ 

School Fund j^^^. j^- ^Q^ld appear that no provision was made 

for constituting the proceeds of these sources of revenue a perma- 
nent fund until 1868. The County School Fund was established 
as a permanent fund by section 18 of an act approved March 27, 
1868. The original principal consisted of the proceeds of fines, 
penalties, and forfeitures,^^^ and the proceeds of 3,185,479 acres 
of swamp land granted by Congress under an Act of 1850. 

It would be impossible in the case of Missouri, as with many 
other states, to ascertain definitely the amount of 

Loss 

the permanent school fund which has been lost. 
The report of the Superintendent of Public Schools for 1870, 

* See Part I, Chapter III, for an account of the Surplus Revenue Fund. 

328 Ibid., Report U. S. Commissioner of Education, 1900-01, I, p. 376. 

329 Report Mo. Supt. of Public Schools, 1903, p. 94. 

330 Ibid., 1869, p. 38. 

331 Bourne, Edward G., History of the Surplus Revenue of 1837. 

332 Mo. Law, Feb. 9, 1839. 



MISSOURI 323 

Chapters XII and XIII, attempts to give an account of the amount 
of the Township School Fund which has been lost. The report 
shows that at that time over a hundred thousand dollars of this 
one fund alone was reported lost, but as in the case of many town- 
ships the amount lost could not be ascertained, the total loss 
exceeded that reported. Among the various reasons given are: 
burning of the court-house, parties running away; parties insolvent; 
default of county treasurer; notes outlawed; stolen; carelessness; 
the war; insufficient security; parties absconding; robbery; records 
imperfectly kept; townships having no fund being too disloyal 
to organize; records burned; carelessness of officers; worthless notes. 

R. D. Shannon, State Superintendent of Pubhc Schools in 1876, 
points out that the county funds were sometimes invested in direct 
and flagrant violation of the law, and that the moneys due the 
principal were not always added. He writes as follows: "The 
township, swamp land and county school funds are under the 
control of the various county courts and, as a rule, have been badly 
managed. They have to a shameful extent been lost, squandered 
and stolen. This was more particularly true in the war period of 
our history. . . . There is still, however, in some cases, a loose- 
ness of management that amounts to culpable neglect. In some 
cases county courts have invested their township and county school 
funds in school bonds and otherwise in direct and flagrant violation 
of the law. . . . Fines, forfeitures, and penalties have not always 
been faithfully accounted for nor applied to the funds to which the 
law directs their application." ^^^'^ 

The State Public School Fund may be increased by grant, gift, 
devise, appropriation by the General Assembly, proceeds of estates 
Sources of escheating to the state. The County Public 

Increase School Fund may be increased by the net proceeds 

of fines collected for breaches of military or penal laws of the state; 
penalties, forfeitures, estrays; sale of swamp lands; military exemp- 
tion moneys. The Township School Fund may be increased by 

332a Report, Mo. Supt. Public Schools, 1876, pp. 13-14. 

333 Report Mo. Supt. of Public Schools, 1900, p. 43; Revised School Laws of 
Mo., Sec. 9824, p. 58. 



324 PERMANENT COMMON SCHOOL FUNDS 

the sale of such parts of sixteenth section lands as remain unsold. 
The Special District Funds may be increased by grant, gift, devise, 
or special legislation. 

The Public School Fund is managed by the State Board of 

Education.^^"* The County and Township Funds are managed by 

the county courts of their respective counties.^^^ 

Management . 

The Special District Funds are managed for the 
district by the District Board of Directors.^^^ 

The revenue of the State Public School Fund is apportioned by 
the State Superintendent of Public Instruction upon the basis of 

school enumeration, that is, school population, 

Apportionment 

(six to twenty years) .^^^ 
The revenue of the State, County, Township, and District Funds 
, „ may be legally expended for no other object than 

Lawful Objects J b J t' J 

the payment of teachers' wages.^^^ 
In order to receive its share of the State Public School Fund in- 
come, the district must: (i) maintain a free public school during the 
Conditions of Y^^^ ^^r wliicli the distribution is made for at least 
Participation three months,^^'' for six months if a tax of forty cents 

on $ioo assessed valuation within a district, together with the public 
funds, will maintain the school for that length of time; ^^° (2) must 
send returns as to the enumeration of pupils required by law.^^^ 

334 Revised School Laws of Mo., 1903, p. 57, Sec. 9822. 

335 Ibid., p. 59, Sec. 9829. 

336 Ibid., p. 22, Sec. 9763. 

337 Ibid., p. 29, Sec. 9770. 

338 Ibid., pp. 44, 45, Sec. 9788. 

339 Constitution 1875, Art. XI, Sec. 3. 

340 Revised School Laws of Mo., 1903, Sec. 9840. 

341 Ibid., p. 64. 



CHAPTER XXXIII 
MISSISSIPPI 

LITERARY, CHOCKTAW, OR SIXTEENTH SECTION FUND. CHICKASAW 

FUND 

It would appear that Sixteenth Section Fund is the title applied 
officially to-day to what was originally known as the Literary 
Present Fund. It would be more clear to call this fund 

Condition |.]^g Chocktaw Fund. It is impossible to state the 

actual condition of this fund, as two years of constant effort to 
obtain information from the state authorities has brought no 
appreciable results. The reports of the United States Commis- 
sioner of Education 1903 ^^^ and 1905 ^^^ give data for 1903 as fol- 
lows: * Permanent common school funds (state and local), principal 
$3,466,667,^ income, $187,746, approximately ten and one-tenth 
per cent (.101) t of $15858,990,^^^ the total receipts for common 
schools. The " Chickasaw School Fund" is a "non-payable debt, " 
amounting in 1902 to $949,022.58 ^^^ and in 1905 to $1,002,023.36.^^^ 
How much, if any, of the remainder of these funds, approximately 
two and a half million dollars, actually exists as productive capital 
I am unable to state. Presumably the remaining two and a half 
millions is also a non-payable debt representing the lost Literary 
or Chocktaw Fund. 

The northern counties of Mississippi were originally occupied 
^ . . ,,, by the Chickasaw Indians and the southern 

Origin ^*^ 

by the Chocktaw Indians.^'^^ The Chickasaw 
Fund and the Chocktaw Fund might well be considered as 

* The same report, 1906, gives no more recent data. 

t Computed. 

3*2 Report U. S. Commissioner of Education, 1905, I, p. 419. 

^'•s Report State Treasurer. 

3** Report U. S. Commissioner of Education, 1905, I, p. 410. 

345 Report Miss. State Supt. of Education, 187 1, p. 39. 

3^^ Britiannica Encyclopedia, article on "Mississippi." 

325 



326 PERMANENT COMMON SCHOOL FUNDS 

one, for both owe their origin to Congressional land grants of 
section numbered sixteen in each township. These lands were 
granted 1803/° 1852,^° 1857.^" The total amount of lands granted 
was 838,329 acres.^'' 

The Chocktaw counties received from the general government 

approximately 663,000 acres (663,774 acres) of sixteenth section 

lands.^'*^ In the first constitution, adopted 1817, 

Chocktaw Fund, no mention was made concerning the establish- 

or Sixteenth 

Section Fund, ment of a fund. Four years later, however, a 
fund known as the Literary Fund was established 
by an act of legislature passed November 26, 1821,^^ for the edu- 
cation of poor white children and for the general support of schools. 
The sources provided for contributing to this fund were, all escheats, 
confiscations, forfeitures, and personal property accruing to the 
state, and penal fines and forfeitures. It was provided that neither 
the principal nor interest should be apportioned until the principal 
shall amount to $50,000 (sec. 9). By an act approved March 2, 
1833, provision was made for the distribution of the revenue of the 
Literary Fund (on the ground that the fund now amounted to over 
$50,000) and for the permanent investment of its principal in the 
Planter's Bank of the state of Mississippi, the interest or dividends 
on which should alone be distributed, the shares of stock being 
placed to the credit of the various counties of the state. This 
Literary Fund was lost through mismanagement and bad notes.^^^ 
Some of the Choctaw lands were sold outright prior to 1833, and the 
proceeds eventually lost as just described; others were leased for a 
term of ninety-nine years.^"^ The title of some are (1895) still in 
process of litigation.^^^ Records of the sales of others have been lost. 
Under an act of Congress passed February 23, 1843, the Chick- 
„, . , „ , asaw counties were entitled to receive 174,51^5 

Chickasaw Fund . . . z'+'JJJ 

acres of land granted in lieu of sixteenth sec- 
tions. From the sale of these lands arose the Chickasaw Fund. 

3*7 A Digest of the Laws of Miss., iS^g, by T. J. Fox Alden and J. A. Van Holsen, 
pp. 364-371, Chap. LI, Sees. 1-24. 
3^ Ibid., pp. 383, 384, Sees. 79-83. 
349 Report Miss. State Supt. of Education, 1894-95, p. 31. 



MISSISSIPPI 327 

The state holds this fund in trust for these counties, on which it 
pays annual interest to these counties at the rate of six and one- 
half per cent.^^*^ 

The Literary Fund established in 182 1 was "largely squandered 
through the same craze for a rapid increase of population that in 
so many states has wasted this patrimony of the 
children." ^^^ In 1833 by an act of legislature, 
February 27, there was introduced a system of leasing these lands 
at public auction to the highest bidder for a term of ninety-nine 
years. The securities accepted were insufl&cient in many cases. 
The rents frequently went unpaid and the fund dwindled away 
through the decrease in value of the notes given. What remained 
of it was invested in stock of the Planters' Bank, established 1830 
to 1833. The money so invested was subsequently lost when the 
bank failed. 

No means for increasing either of the funds is provided by the 
Sources of l^"^s or the constitution except the sale of sixteenth 

Increase section lands. 

We find two forms of management, state and county. The 
Sixteenth Section Fund is managed for the township by the county 

to which it belongs, the Board of County Super- 
Management ... 

visors being the managing body.^^^ The Chick- 
asaw Fund is held in trust and managed by the state.^^^ Funds 
derived from sixteenth section lands are credited to the proper 
township, and each treasurer keeps a separate account with each 
township. ^^^ 

From this it would appear that the revenue is apportioned to the 
townships in accordance with the amount of principal standing 

to their credit. The Chickasaw Fund revenue 

Apportionment 

is apportioned among the Chickasaw counties 
upon the basis of their area. 

350 Ibid., p. 24. 

351 School Laws of Miss., 1S96, p. 39, Sec. 4144; p. 41, Sec. 4150. 

352 Ibid., p. 41, Sec. 4150. 

353 A. D. Mayo, Common Schools in the South, Report U. S. Commissioner of 
Education, 1899-1900, p. 493. 



328 PERMANENT COMMON SCHOOL FUNDS 

The County Board of Supervisors is required by law to appoint 

annually three trustees for the townships which have or ought to 

have school lands or funds. These trustees shall 

Objects 

recommend to the Board of Supervisors the lawful 
purpose for which the available funds in their townships ought to 
be appropriated and the same shall be appropriated accordingly.^^ 
The objects to which the Sixteenth Section Fund revenue may be 
applied are enumerated as follows: (i) building and repairing 
school-houses; (2) the purchase of school furniture; (3) water 
and fuel; (4) payment of teachers after the common school term 
shall expire.^^^ 

No conditions are stated which must be fulfilled in order for 
Conditions of the Chocktaw townships to participate in the Six- 

Participation teenth Section Fund revenue, nor for the Chick- 

asaw counties to participate in the Chickasaw Fund revenue. 

354 School Laws of Miss., 1896, p. 42, Sees. 4152, 4153. 



CHAPTER XXXIV 

MONTANA 

PUBLIC SCHOOL FUND 

The permanent common school fund of Montana has two official 
titles; the laws name it the State School Fund,^^^ but in the consti- 
Xitie. tution it is called the Public School Fund.^^'' In 

Condition, 1905 jg^^ the principal of the fund amounted to 
$871,802.62.^" This principal is invested chiefly in state, county, 
municipal, and school district bonds;'''" 2,781,181.49^^^ acres of 
common school land (valued at about $4,000,000^'*^) belonging to 
the State School Fund remain unsold, the proceeds of which 
added to the present principal will give a principal of nearly five mil- 
lion dollars.^^^ The annual revenue (1905) consisted of $27,032.36, 
interest on the principal,^" and $172,375.06, annual rent of common 
school lands,^" making the total annual revenue $199,407.42, or 
approximately three and six-tenths per cent (.0362) * of $5,506,127, 
the total public school moneys received that year, excluding bal- 
ances on hand and proceeds of bond sales.^^ 

A Congressional act, February 28, 1851, reserved in each town- 
ship of the territory, for the use of public schools, sections num- 

. . bered sixteen and thirty-six, amounting in all to 

5,112,035 acres.^"^ The " Enabling Act" approved 
by Congress February 22, 1889, proposed the establishment of a per- 
manent school fund to be derived from the proceeds of these lands 
and from five per cent of the proceeds of the sales of public lands 
granted to the state, and also that none of these lands should be 

* Computed. 

355 School Laws of Montana, compiled at the office of the Supt. of Public In- 
struction, 1903, p. 94, Sec. 1940. 

356 Constitution of Montana, Art. XI, Sec. 2. 

357 Statement received Nov. 26, 1906, from Montana State Treasurer, J. H. Rice. 

358 Mont. State Treasurer's Report, 1905-06, p. 8. 

329 



330 PERMANENT COMMON SCHOOL FUNDS 

sold at less than ten dollars per acre.^^^ These propositions were 
accepted by Constitutional Ordinance No. i adopted August 17, 
1889, and became effective upon the state's admission into the 
Union, November 8, 1889. 

The following sources for increasing the State School Fund are 
provided by law: (i) appropriations and donations by the state to 
Sources of the State School Fund; (2) bequests and donations 

Increase ^^o ^^ individuals to the state or common schools; (3) 

proceeds of land and other property escheating or forfeited to the 
state; (4) proceeds of all property granted to the state when the 
purpose is not specified or is uncertain; (5) funds accumulated in 
the treasury of the state for the disbursement of which provision 
has not been made by law; (6) proceeds of the sale of timber, stone, 
material or other property from school lands other than those 
granted for specific purposes; (7) all moneys other than rent 
recovered from persons trespassing on state lands; (8) five per cent 
of the proceeds of the sales of lands within the state belonging to the 
United States; (9) the principal of all funds arising from the sale 
of lands and other property which have been or may hereafter be 
granted to the state for common schools; (10) the principal of such 
other funds as may be provided for by law. 

The State School Fund is managed by the State Board of Land 

Commissioners composed of the Governor, President of the Board, 

Superintendent of Public Instruction, Secretary 
Management 361 '■ 

of the Board, and the Attorney-General. This 

Board has direction, control, and power to lease or sell any of the 

school lands of the state. 

The revenue of the State School Fund is apportioned by the State 

Superintendent of Public Instruction among the 

Apportionment 362 ^ " 

several counties in the state m proportion to the 
number of children of school age in each (six to twenty-one years) .^^^ 

359 Sees. 10, II, 13, Enabling Act, (p. Ixxii, Montana Civil Codes, annotated, 
189s, Vol. i). 

360 Ibid., p. cxxxiii. 

361 Civil Code of Montana, 1895, Part III, Title VIII, Art. I, Sees. 3470, 3472. 

362 School Laws of Montana, 1903, Chap. VI, Art. I, Sec. 1714. 

363 Constitution of Mont., 1889, Art. XI, Sec. 5. 



MONTANA 331 

The State Treasurer pays the district quota to the county treas- 
urer. No distinction is provided for by law between the money thus 

paid in and money derived from taxes. The dis- 
Objects ^ ^ .... 

trict trustees may devote money lymg m the county 

treasury and credited to the district to the following objects of 

school expenditure : ^^^ (i) furniture; (2) repairs; (3) rent; (4) 

insurance; (5) text-books for indigent children; (6) transportation 

of pupils. 

No district shall be entitled to a share of the State School Fund 

revenue which does not maintain a free public school for at least 

Conditions of three months during the year, for which distri- 

Participation butions shall be made.^^^ No sectarian, partisan, 

nor denominational doctrine may be taught, nor any publication 

of such a character be used or distributed in any school or made a 

part of its library .^^^ 

364 School Laws of Mont., 1903, Chap. VI, Art. 5, Sees. 1797-1818. 

365 Ibid., p. 14, Constitution of Mont., 1889, Art. XI, Sec. 5. 

366 Ibid.,p. 77, Sec. 1863. 



CHAPTER XXXV 

NEBRASKA 

PERMANENT SCHOOL FUND 

The permanent common school fund of Nebraska, officially 
known as the Permanent School Fund^*^^ consisted in 1905 of 
Tjtig $6,238,381.27 ^^^ and of 1,920,955 acres ^'^ of com- 

Condition, 1905 jnon school lands, estimated at $12,002,000,^^ 
making the total estimated value of the fund $18,240,381.27.* Of 
the unsold school lands only 497 acres, estimated at $2,000, are not 
leased.^'^ The Permanent School Fund is invested chiefly in state 
bonds of other states, Nebraska general fund warrants, county 
bonds, and some United States bonds.^*^^ Nebraska has borrowed 
from the Permanent School Fund $1,477,070.78, on which the state 
pays four per cent interest, deriving the money from "the same 
sources as all general expenses." ^^* The rent of common school 
lands is added to the annual revenue of the Permanent School 
Fund;^^^ in 1905 this rent amounted to $176,043.99,^^^ and revenue 
derived from principal to $476,871.84.^*^^ The total Permanent 
School Fund revenue was therefore $652,915.83,* approximately 
eleven and nine-tenths per cent (.119)* of $5,447,362.21, the total 
receipts for common schools from all sources in 1905.^*^^ 

On April 19, 1864, Congress reserved for the use of public schools, 

sections numbered sixteen and thirty-six in every township in 

Nebraska.^" The total area of the lands thus 

Origin 

granted amounted to 2,702,044 acres,^" and these 
lands became the property of the state three years later upon her 
admission into the Union. The establishment of the Permanent 
School Fund was provided for by the first constitution adopted by 

* Computed. 

367 Report Neb. Dept. of Public Instruction, 1S87-S8, p. 16; Index to School Law. 

368 Data furnished Sept. i, 1906, by Neb. State Supt. of Public Instruction. 

332 



NEBRASKA ^^^ 

the state.^^^ The constitution of 1867 provided that none of these 
lands should be sold at less than $5.00 per acre (the constitution of 
1875 raised the price to I7.00), thus fixing the minimum value of 
the original capital at $13,510,220. 

Four sources are provided by law and by the constitution for 
increasing the principal of the Permanent School Fund: (i) five 
Sources of P^^ cent of the proceeds of sales of United States 

Increase public lands lying within the state; ^^^ (2) estates 

escheating to the state; ^'^^ (3) the proceeds of the sales of sixteenth 
and thirty-sixth section lands; ^'^^ (4) proceeds of the sales of saline 
lands (Laws of 1893).^*^^ 

The first investments of the moneys belonging to the Permanent 
School Fund were made at a loss of $1,547.04. Investments 
made in the year 1868 resulted in an aggregate 
loss of $3,439.67.^'^^ In the year 1897 the Perma- 
nent School Fund lost $259,842.87 through embezzlement.^^* It 
may well be added that sums borrowed by the state and on which 
the interest is paid out of taxation thwart one of the most impor- 
tant purposes for which the fund was established, namely, to lessen 
taxation; to borrow the principal and tax the people for the interest 
is a direct violation of the spirit if not of the letter.* 

The Permanent School Fund is managed by a " Board of Edu- 
cational Lands and Funds" under the direction of the legislature. 
The Board consists of the Governor, Secretary 

Management ■' 

of State, Treasurer, Attorney-General, and Com- 
missioner of Public Lands and Buildings.^"^ 

The revenue is apportioned amono; the counties 

Apportionment ^ ^ *^ 

upon the basis of school population.^'^^ 

* For a full discussion of this matter see Part I, also the other states, e. g., 
Minnesota. 

369 Report U. S. Commissioner of Education, 1892-93, II, 1355, Art. II, Sees, i, 2. 

370 School Land Laws of Neb. as revised in 1899, and the School Laws, p. 127, 
Sec. 30. 

371 Constitution of Neb., Art. VIII, Sec. 3. 

372 Report Neb. State Supt. Pub. Instruction, 1869-70, pp. 70-73. 

373 Constitution of Neb., Art. VIII, Sec. i, and p. 118, Sec. i. Neb. School Laws, 
1899, P- 9- 

374 Ibid., p. 48, Sec. 9. 



334 PERMANENT COMMON SCHOOL FUNDS 

The state common school fund can be apphed to the payment 
Objects of teachers' wages only.^^^ 

In order to participate in the revenue of the Permanent School 
Fund, the district (i) must have a school taught by a legally 
Conditions of qualified teacher; (2) for the term established by 

Participation jg^^. ^^^ j^gg ^^lan three months in a district having 

less than twenty pupils; not less than six months in a district having 
from twenty to seventy-five pupils; not less than nine months in a 
district having more than seventy-five pupils.^^* 



CHAPTER XXXVI 

NEVADA 

STATE SCHOOL FUND 

The permanent common school fund of Nevada is known offi- 
cially as the State School Fund.^'^ The principal of the fund, 
Title. December i, 1906, consisted of $1,651,078.81; of 

Condition, 1906 ^^i^^ $20,678.81 was awaiting investment, and 
$1,630,400 was invested as follows: state irredeemable five per 
cent bonds $380,000; state four per cent bonds $155,400; United 
States four per cent bonds $215,000; Massachusetts three per cent 
bonds $626,000; Massachusetts three and one-half per cent bonds 
$254,000.^" About 1,250,000 acres of school lands belonging to 
the permanent school fund are under contract for sale.^^^ No 
rent is derived from school lands,^'* so this limits the annual income 
to (i) the interest on bonds which in 1906 amounted to $61,486, 
and (2) interest on about " 1,250,000 acres of land under contract, 
the deferred payments on which, amounting to $1,250,000, draw 
interest at six per cent per annum, amounting to $75,000, all of 
which, except ($5,400) the interest on contract lands selected under 
the 90,000 acre university grant, goes into the general school fund 
and is distributed semiannually among the public schools of the 
state." ^'^^ The total common school revenue for 1906 derived 
from all sources amounted to $275,388,^*" forty-nine and two-tenths 
per cent of which (.4919),* namely, $135,486* was derived from 
the interest on the State School Fund. 

Article XI, section 3 of the first constitution of Nevada, which 

* Computed. 

375 State of Nev. School Laws, 1897, p. 33, Art. XIX, Sec. i. 

377 Report Nev. State Land Register, 1905-06, p. 13. 

378 Data furnished Jan. 10, 1906, by Nev. State Treasurer. 

379 Report Nev. State Land Register, 1905-06, p. 14. 

380 Report U. S. Commissioner of Education, 1906, 1, p. 306. 

335 



2,s6 PERMANENT COMMON SCHOOL FUNDS 

became effective upon the state's admission into the Union, 1864, 
solemnly pledged for educational purposes moneys derived from the 

. . following sources: (i) the proceeds of sixteenth 

and thirty-sixth section lands; (2) the Agricul- 
tural College lands granted by an act of Congress approved 
July 2, 1862; (3) 500,000 acres internal improvement lands (Con- 
gressional grant, 1841); (4) "and all proceeds of lands that have 
been or may hereafter be granted or appropriated by the United 
States to this state;" (5) estates escheating to the state; (6) such per 
cent (five) as may be granted by Congress on the sale of public 
lands; (7) penal fines; (8) property given to the state for educational 
purposes.^^^ Section 8 of the same article set aside the agricultural 
lands as a separate fund. Two million (2,000,000) acres to be 
selected by the state were accepted by the legislature in lieu of the 
sixteenth and thirty-sixth sections in each township. The six- 
teenth and thirty-sixth sections would have aggregated 3,992,000 
acres, so that by accepting the two million acres grant the state 
lost 1,992,000 acres, "but it had the advantage of selecting any 
unappropriated public lands whether in the sixteenth or thirty- 
sixth sections or not." ^^^ 

The following means of increasing the principal are at present 
provided for by constitution or by law: (i) proceeds of the sales 
Sources of of public lands; ^^^ (2) proceeds of escheated 

Increase 382 estates; ^^' (3) a certain per cent of the sales of 

United States lands lying within the state; ^^^ (4) proceeds of 
property given or bequeathed to the state for purposes of edu- 
cation; (5) fines for penal offenses; ^^' (6) two per cent of the 
proceeds of all toll rates and bridges.^^^ 

" The $380,000 irredeemable bond was placed in the treasury in 
1879 in lieu of an equal amount in cash borrowed 

Loss 

from the State School Fund to pay the territorial 
indebtedness, which was assumed by the state when the Consti- 

381 Report Nev. State Land R.egister, 1905-06, p. 8. 

332 Constitution of Nev., 1864, Art. XI, Sec. 3 (PvCport U. S. Commissioner of 
Education, 1892-93, II, p. 1348). 
383 State of Nev. School Laws, 1897, p. 33, Art. XIX, Sec. i. 



NEVADA 337 

tution was adopted." ^^^ The constitution of 1864, art. XI, sec. 3, 
expressly declares that "all proceeds derived from any or all of 
said sources shall be, and the same are hereby solemnly pledged 
for educational purposes, and shall not be transferred to any other 
fund for any other uses." The state has borrowed also $233,000.^^* 
The four per cent interest on this loan as well as the five per cent 
interest on the irredeemable bond is paid out of state taxes.^'^* To 
use the moneys belonging to the principal of the permanent school 
fund and then tax the people for the interest is a direct violation 
of one of the purposes for which the permanent school fund was 
established, namely, the lessening of taxation. * 

The State School Fund is managed by the state 

Management ^ ■' 

treasurer.^^^ 

The revenue is apportioned among the counties 

Apportionment ^ ^ ° 

on the basis of school population (six to eighteen 
years) .^^^' ^^^ 

The revenue of the State School Fund may be expended only 

for the wages of teachers duly qualified by the State Board of Edu- 

Q^-^^^^ cation.3^3 No portion of the fund shall be paid 

for the erection of school buildings, the use of 

school-rooms, furniture, or any other contingent expense.^®^ 

In order to share in the State School Fund revenue the district 
must (i) maintain a school at least six months;^^^ (2) must not 
Conditions of permit sectarian instruction; ^^ (3) the school must 
Participation ^^ ^^^^-^^ ^^ ^ ^^j^ qualified teacher; ^86 (4) the 

teacher must submit the report required by law.^^' 

* For a further discussion of this matter, see Part I, also Part II, Minnesota 
and Nebraska. 

384 State of Nev. School Laws, 1897, p. 35, Art. XIX, Sec. 12. 

385 Report U. S. Commissioner of Education, II, 1892-93, p. 1347; Constitution 
of Nev., 1864, Art. XI, Sec. 2. 

386 State of Nev. School Laws, 1897, p. 33, Art. XIX, Sec. 3. 

387 Ibid., p. 27, Art. XI, Sec. I. 



CHAPTER XXXVII 
NEW HAMPSHIRE 

INSTITUTE FUND 

For many years federal reports and other accounts dealing with 
permanent common school funds have credited New Hampshire 
Title. Present ^^^h no permanent school fund.^^* On the con- 
Condition trary, such a fund has been in existence ever since 

1867, and has been slowly but steadily increasing, though it was 
not used for schools. Prior to 1883 it was known as the " Common 
School Fund." Since 1883 it has been known as the "Institute 
Fund." ^^* In 1905 the principal of the Institute Fund amounted 
to $59,470.37,^^^ and its annual interest to $2,372.66,^*^ the latter 
sum being approximately two-tenths of one per cent (.0017) * of 
$1,359,181.26, the total common school revenue derived from all 
sources that same year.^^^ The "Institute Fund" has been bor- 
rowed by the state and constitutes a permanent debt on which the 
state pays four per cent annual interest, paying the same out of 
state taxes.^^ The principal is growing at present though slowly, 
through the addition to it (on account) of unexpended balance of 
its annual interest, no other source of increase being provided for 
by law.^*^ The Institute Fund is managed by the governor and 
council.^*^ Its interest can be used for no other purpose than for 
supporting teachers' institutes.^^^ The interest is apportioned upon 
the order of the State Superintendent of Public Instruction.^*^ The 
Institute Fund, like the permanent common school funds in 
many other states, is not to-day an invested productive fund but 
merely an account or debt which the state acknowledges. The 

* Computed. 

388 Report U. S. Commissioner of Education, 1896-97, p. 642, and other reports. 

389 From statement received July 17, 1907, from H. C. Morrison, N. H. State 
Supt. of Public Instruction. 

338 



NEW HAMPSHIRE 339 

state used the principal as it was paid into the treasury and now 
pays the annual interest out of state taxes.^^^ We have here then 
a permanent state debt for which the commonwealth must be taxed 
instead of a productive fund lessening taxation. 

The so-called Literary Fund of New Hampshire is not in any 

sense a permanent fund. The law defines it as follows: "All taxes 

collected by the state upon the deposits, stock, 

Literary Fund •' ^ r » j 

and attending accumulations of depositors and 
stockholders of saving banks, trust companies, loan and trust com- 
panies, loan and banking companies, building and loan associations, 
and other similar corporations, who do not reside in this state or 
whose residence is unknown, shall be known as the ' Literary Fund. ' 
The state treasurer shall assign and distribute in November of each 
year the Literary Fund among the towns and places in proportion 
to the number of scholars not less than five years of age, who shall 
by the last reports of the school boards returned to the State Su- 
perintendent of Public Instruction, appear to have attended the 
public schools in such towns and places not less than two weeks 
within that year.^^" "In other words, the term Literary Fund is 
applied to an annual revenue resulting from the proceeds of "a 
non-resident savings bank tax." The proceeds of this tax in the 
year 1902 amounted to $33,774.02.^^^ 

The United States apportioned to New Hampshire $669,086.79 

in the distribution of the Surplus Revenue Loan of 1837. No 

state permanent fund was established with this 

Surplus money. On the contrary, the total sum received 

Revenue Loan .. ... . . , 

except that murmg to communities not then 

incorporated into towns" was divided among the several towns — 

with the privilege of devoting the whole or a part to the support 

of public schools. By an act passed December 18, 1842, the towns 

were empowered to make any disposition of it as should be deemed 

equitable and expedient. In Portsmouth, New Hampshire, the 

inhabitants voted to divide the revenue which fell to the town, per 

capita : — the sum due to every man, woman, and child being between 

390 Laws of N. H., 1901. 

381 N. H. State Treasurer's Annual Report, p. 316. 



340 PERMANENT COMMON SCHOOL FUNDS 

two and three dollars. An agent was appointed to receive and 
distribute the money; about 200 suits were almost immediately 
commenced against him as trustee of individuals owing small sums, 
and he was thus placed in rather an embarrassing position.^^' As 
near as can be estimated, about fifty towns used their money, about 
$30,000, to establish permanent local school funds, yielding an- 
nually about $1,800. Nevertheless most of what might have be- 
come the basis of a great state permanent fund vanished. 

The Literary Fund was provided for by an act passed June 29, 
1 82 1, which required that all banking corporations should either 
Origin. Literary ^^6 paper Stamped by some suitable stamp for 
Fund, 182 1 bills, notes, or obligations put in circulation; the 

stamp to be paid for by the banks at the rate of $50 on the thousand 
of the circulation; or instead thereof to pay annually one-half of 
one per cent of their capital stock.^^^ The proceeds arising from 
the second provision, that of the tax of one-half of one per cent of 
the capital of the bank, eventually became the Literary Fund. 
The original purpose in establishing this fund was to aid an insti- 
tution of higher learning, but by 1828 this purpose was given up 
and the fund which had accumulated up to that time and amounting 
then to $64,000 was distributed to the towns to be used for common 
schools. After that the fund was distributed annually .^^^ 

In 1867, the governor was authorized to sell public lands, "wild 

lands," with the advice of the council, the proceeds to be placed 

in the state treasury, and "to constitute a part 

Origin Common 

School or of the Literary Fund to be divided among the 

Institute Fund 1 • • i i i i t i 

several cities and towns and by them applied to 
the maintenance of common schools or to other purposes of edu- 
cation." ^^^ A law passed the following year provided that the pro- 
ceeds of the sale of the state lands affected under the authority of a 
joint resolution approved June 28, 1867, "shall be and the same 

392 Bourne, Edward G., History of the Surplus Revenue of iSjy, p. S3, and note. 

393 N. H. Compiled Laws, 1815-24, p. no. 

394 N. H. Revised Statutes, 1842, Chap. 75, p. 154; N. H. School Report, 1872, 
p. 163; U. S. Bureau of Education, Circular of Information, 1S98, No. 3, p. 15. 

395 Laws of N. H., 1867, Chap. XLII, Sec. i. 



NEW HAMPSHIRE 341 

hereby are set apart as a school fund. The annual income of the 
said fund shall be applied to the purposes of a common school 
education in such way and manner as the legislature may from 
time to time determine," ^^^ "The New Hampshire fund derived 
from the sale of public lands in the White Mountain region is known 
as the Institute Fund. The income, which is about, $2,300 a year 
is used for the purpose of maintaining teachers institutes." ^^' 

"These wild lands were a part of the ungranted public domain 
which had come down as such from colonial times. From the sale 
of these lands $25,000 was realized. This money was paid into 
the state treasury; and it is provided by law that the same shall be 
reserved for the use of common schools, and that the state shall 
pay interest thereon at the rate of six per cent. The fund never 
seems to have been appropriated as a common school fund to any 
purpose, but was used by the state as other moneys, being counted, 
together with its accumulated interest, as a part of the state debt. 
In 1883, largely through the interest of Hon. J. W. Patterson, at 
that time the Superintendent of Public Instruction, the teachers' 
institute system was established; and the income from this fund, 
together with its accumulated interest, v/as set apart to pay for the 
institutes.^^^ The account when opened as an institute fund on 
June I, 1884, amounted to $47,918.75. Since that time the insti- 
tute system has been continuously in operation. The amount left 
unexpended each year has been added to the principal, so that at 
the close of the last fiscal year the amount was $59,529.17. The 
annual income is now nearly $2,400. In 1895, the General Court 
reduced the rate of interest from six per cent to four per cent, 
presumably for the purpose of bringing the state's annual obliga- 
tion down to something like the current rate of interest." ^^* 

396 Ibid., 1868, Chap. XXI, Sees, i, 2. 

397 Extract from letter dated Aug. 30, 1906, received from H. C. Morrison, State 
Supt. of Public Instruction. 

398 Ibid., dated July 15, 1907. 

399 Laws of N. H., 1883, Chap. 73; Rev. Stats., Chap. 94, Sees. 4-8. 



CHAPTER XXXVIII 
NEW JERSEY 

THE NEW JERSEY PERMANENT SCHOOL FUND 

The of3&cial title of the New Jersey permanent common school 
fund is Permanent School Fund.'^'^° The reports and laws also 
Title— Condition ^^c the terms "State School Fund" and "School 
1902 and 1905 Fund." In 1902 this fund amounted to $3,839,- 
692^*'^ and its annual revenue to $196,824'*'^' which was approxi- 
mately two and eight-tenths per cent (.0277) of $7,118,248, the total 
common school revenue for that year. In 1906 the principal of 
the Permanent School Fund amounted to $4,523,916.92.'**^^ It is 
impossible to state the acreage or value of the lands belonging to 
the fund as the law sets aside for it all lands that are or have been 
under water. The state apportions $200,000 * a year as the fund's 
income, which is two and five-hundredths per cent of $9,773,562, 
the total receipts for common schools in 1905.^°* 

The Permanent School Fund was estabhshed February 12, 1817, 

by an act of legislature.'*^^ The date 181 6 sometimes given appears 

. to be incorrect as no mention is made concerning 

any permanent school fund in the act of that year 

relating to schools.'^"^- ^'^^ The capital set aside by the Act of 181 7 

* Actual income not equal to this. 

^oo New Jersey School Law, 1903, p. 63, Sec. 16S. 

401 Controller's Report, 1902, p. 90. 

402 Controller's Report, 1902, pp. 92, 93, the difference between this amount 
and that stated in Report U. S. Commissioner is due perhaps to the fact that the 
latter includes the revenue of local funds and land rents, or else it may include the 
$180,000 loaned by the state to the school fund. The total of the school fund loan 
and balance, 1901, was $385,889. 

403 Data furnished by C. J. Baxter, State Supt. of Public Instruction, Mar. 15, 
1907. Superintendent Baxter failed to state income of Permanent School Fund. 

404 Report U. S. Commissioner of Education, 1906, I, pp. 306, 307. 

405 U. S. Bureau of Education, Circular of Information, 1899, No. i, p. 29, gives 
1816. 

408 N. J. Laws of 1799-1820, p. 612. 

342 



NEW JERSEY 343 

consisted of $15,000, derived ''from the payment to the state of the 
principal and interest of the funded debt of the U. S. due this state, 
and from the dividends on the shares belonging to this state in the 
capital stock of the Trenton Banking Company," and which the 
previous year by the order of legislature had been invested in six 
per cent bonds.^^'^ In addition to this realized principal several 
sources of increase were provided as follows: (i) "all dividends 
which may hereafter be received on the shares of this state in the 
capital stock of the Cumberland Bank, and (2) on the shares of the 
state in the Newark Turnpike Company, (3) all moneys to be 
received on the sale of the house and lot belonging to this state in 
the city of New Jersey ,^°^ (4) and one-tenth part of all moneys 
hereafter to be raised by tax for the use of the state." '^^^ 

By an act passed February 14, 181 8, additional stocks belonging 
to the state were added to the fund, making the total estimated 
value at this time $87,076.34'^"^ as follows: 

Estimated Value 

U. S. six per cent bonds $15,000.00 

Newark Turnpike Road shares 12,500.00 

Balance due on old U. S. six per cent bonds 10,654.78 

U. S. three per cent stock 5,071.90 

Cash received for old U. S. six per cent stock 5,849.66 

Trenton Banking Company shares 36,000.00 

Cumberland Bank shares 2,000.00 

Total $87,076.34 

New Jersey received from the United States in 1837, $764,670.60 
of the surplus revenue distributed as a loan among the states by the 
Congressional act, passed June 23, 1836. In 1837 the state divided 
the entire sum among the counties which were directed to loan 
their respective shares and pay the interest to the several town- 
ships. Probably the townships devoted much of this interest to 
schools from the first. The counties appear to have exhausted the 
principal in erecting buildings and paying debts, but they have 

407 Ibid., p. 600. 

*08 Ibid., pp. 649-650, 652. 



344 PERMANENT COMMON SCHOOL FUNDS 

continued to pay the townships the interest due them. In 1867 
an act was passed directing townships to devote to schools the 
interest of the surplus revenue received by them.^°^ Since this 
time the interest on approximately four-fifths of the surplus revenue 
has been used for supporting public schools/^" In view of the 
fact that the fund has been practically exhausted and that what 
is nominally interest is really raised by taxation, this fund must 
be regarded as a credit fund or an account and not a permanent 
fund.* 

The present law (1903) provides two sources for increasing the 
principal of the Permanent School Fund: (i) the proceeds of ripa- 
Present Sources ^'^^^ lands, i. c., all lands belonging to the state 
of Increase ^^^ qj. formerly lying under water; ''^^ (2) the pro- 

ceeds of the leases of riparian lands.'*^^ The law requires that 
$200,000 be annually apportioned from the income of the Perma- 
nent School Fund. If the revenue of the fund itself does not equal 
this amount the deficiency shall be drawn from the state treasury, 
the same to be replaced from the Permanent School Fund income 
as soon as the latter has been received.'*^^ 

The Permanent School Fund is in the hands of a board of man- 
agers known as "the trustees for the support 
Manageaient . 

of public schools," composed of the Governor, 

Attorney-General, Secretary of State, State Controller, State 
Treasurer.^^^ 

The revenue of the Permanent School Fund is apportioned upon 

a twofold basis : first, depending upon the length of time a teacher 

has been employed; second, depending upon the 

Apportionment f J > ^ . & ^ 

school attendance; first, $200 is apportioned to 

each district for each teacher throughout the preceding school 

* For an account of the United States Surplus Revenue Loan, consult Part I, 
Chap. III. For an account of the Credit Funds, see Part I, Chap. I. 

409 N. J. Laws, 1867, 378. 

410 These statements are taken chiefly from E. G. Bourne, History of the Surplus 
Revenue of i8jy, pp. 84-86, 122. 

411 N. J. School Laws, 1903, Sees. 168, 169. 

412 Ibid., Sec. 176. 

«8 Ibid., 1903, p. 62, Art. XVI, Sec. 166. 



NEW JERSEY 345 

year; $80 for each teacher employed less than the school year, but 
not less than four months; $600 to each district which has employed 
a supervising principal or special superintendent of schools devot- 
ing his whole time to supervision of schools of such district; ^^'* 
second, the total school attendance of the preceding year serves as 
the basis for apportionment of public moneys remaining after the 
apportionment upon the above basis of number of teachers and 
supervisors employed; third, any balance remaining in the hands 
of the district is returned to the county collector and reappor- 
tioned by the county superintendent among all the districts of 
the county .'^^^ 

The objects to which the revenue may be applied by the dis- 
tricts are not carefully nor clearly defined. The law states that 
it may be used for (i) the support of public 
schools; (2) the payment of the salaries of county 
superintendents; (3) payment of premiums and accrued interest 
on bonds purchased by the trustees for the support of public 
schools, and for no other purpose whatsoever .'^^^ The term "sup- 
port of public schools" is not defined, so it would seem to be left 
largely to the discretion of the district to apply the money to such 
objects of expenditure for schools as it sees fit.* 

The conditions which must be fulfilled by a district in order to 
share in the revenue of the Permanent School Fund may be sum- 
Conditions of marized as follows: (i) maintenance of a public 
Participation school for not less than nine months; (2) in case 

a board of education, legal voters of a district, any board or officers 
of the same or any teacher shall neglect and refuse to perform any 
duty required by law, the quota of the school fund revenue belong- 
ing to the same shall be withheld until compliance has been ob- 
tained; ^^^ (3) provision by a district of suitable school facihties and 

* See Idaho, foot-note 122". 

*i* Ibid., Sec. 182, amended by laws of 1906, Chap. 241, May 17, which makes 
several important changes. See Bureau of Education Bulletin, No. 3, 1906, p. 50, 
Sec. 230. 

«5 Ibid., Sec. 183. 

*i6 Ibid., Sec. 170. 

*17 Ibid., Sees. 14, 15. 



346 PERMANENT COMMON SCHOOL FUNDS 

accommodations for children residing in the district and desiring 
to attend the school therein; ^^^ (4) plans for school buildings must 
be submitted to the State Board of Education for suggestions and 
criticism,^^^ certain architectural requirements being specified by 
law. 

418 Ibid., Sec. 126. 

419 Ibid., Sees. 129, 130. 



CHAPTER XXXIX 
NEW MEXICO 

PERMANENT FUND 

"The only permanent common school fund New Mexico has 
is derived from the Congressional grant of five per cent of the 
sales of public lands lying within the territory .^° The moneys 
which had accumulated from this source up to June 30, 1905 
amounted to $19,675.73.'^" June 21, 1898, Congress passed an 
act entitled, "An Act to make certain grants of land to the Terri- 
tory of New Mexico, and for other purposes." Section 4 of this 
act provided " that five per centum of the proceeds of the sales of 
pubhc lands lying within said territory which shall be sold by the 
United States subsequent to the passage of this act, after deduct- 
ing all expenses incident to the same, shall be paid to the said 
territory, to be used as a permanent fund, the interest of which 
only shall be used for the support of common schools within said 
territory." Section i of the same act granted to the territory for the 
support of common schools sections numbered sixteen and thirty- 
six in each township. New Mexico has reserved for the support 
of common schools the sixteenth and thirty-sixth sections in each 
township as provided for by section 15 of the Organic Act approved 
September 9, 1850^^ and by subsequent territorial or congres- 
sional enactments.^^ As a result New Mexico possesses 1,147,117 
acres of common school lands ^° which are under lease and so 
yield a revenue. In addition to these it possesses 2,280,1 17 acres '^^ 
of common school lands not under lease, and yielding no revenue, 

*20 Data furnished Oct. 20, 1906, by Hiram Hadley, New Mexico Territorial 
Supt. of Schools. 

^1 The General Laws of New Mexico, 1860-80, compiled under the direction of 
L. Bradford Prince, p. 576. 

*22 Ibid., Sec. 4, p. 425. 



348 PERMANENT COMMON SCHOOL FUNDS 

making a total of 3,427,234 acres. The value of all these lands 
estimated at $1.25 per acre is $4,284,042.50. Unless Congress 
shall make some special provision granting New Mexico the right 
to dispose of her school lands while a territory, no lands can be 
sold until the territory l^ecomes a state. The total common school 
revenue in 1905 derived from all sources was $527,473.59:^^° of 
this $39,046.49,^° or approximately seven and four-tenths per cent 
(.074) t was derived from the rent of common school lands. 



f Computed. 



CHAPTER XL 

NEW YORK 

I — LITERATURE FUND. II — COMMON SCHOOL FUND. HI — UNITED 
STATES DEPOSIT FUND 

New York possesses three state permanent common school funds 
known officially and respectively as follows : the Literature Fund,'*^^ 
Title. the Common School Fund,'^^ and the United 

Condition, 1905 States Deposit Fund.^^ The last of these funds, 
though technically a loan to the state by the federal Government, 
has long been, and rightly from a purely practical point of view, 
regarded as a permanent common school fund.* The condition of 
these three funds in the year 1905 was as follows :^^ Literature 
Fund, principal, $284,201.30, income, $9,987.50; Common School 
Fund, principal, $4,673,140.77, income, $169,889.06; United States 
Deposit Fund, principal, $4,014,520.71, income, $155,648.06. 
Total principal, $8,971,862.78; total income, $335,524.62. The 
state appropriates from the revenues of these funds three hundred 
forty-nine thousand five hundred dollars ($349,500) toward the 
support of schools. (Laws of N. Y., Chap. 683, enacted May 31, 
1906.) The total annual public school revenue derived from 
all sources amounts (1905) to $47,803,172.33,'^^ of which approxi- 
mately seven- tenths per cent (.007)! was contributed by permanent 
state funds. "The capital of these funds is kept inviolate and if 
there are any losses they are made good from the General Fund." ^^ 

In the part it has played in the past in developing a system of 
free schools lies the importance of the New York Common School 

* For full explanation of this, see U. S. Surplus Revenue Fund, Part I. 

■j- Computed. 

*23 Laws of New York 1Q05, Chap. 587. 

424 New York Controller's Report, 1905-06. 

425 Statement received Sept. 10, 1906, from Hiram C. Case, Chief of Statistics 
Division, N. Y. Dept. of Education. 

420 Extract from letter from Wm. C. Wilson, N. Y. State Controller, Dec. 17, 
1906. Cf. this with later statement regarding loss. 

349 



350 PERMANENT COMMON SCHOOL FUNDS 

Fund. To-day it contributes but a small per cent of the total 
school revenue. It was not the first means of support of schools, 
in fact, seven others antedate it; namely: (i) rate bills; (2) 
Literature Fund, 1786; (3) local or town funds, 1789; (4) town tax, 
1795; (5) annual appropriation of $100,000, 1795-1800; (6) htera- 
ture lotteries, 1801-21; (7) gifts. 

Rate bills, tuition fees, were charged in New York state from 
time immemorial until 1867. In 1867 they were 
abolished whereupon the schools which had been 
public became •free.^^- '^^^ 

Town funds arose from an act of legislature, 1786,'*^^ which 
provided that the unappropriated land of the state should be laid 
Town Funds, out in townships of 64,000 acres.^^° In every 

1786 and 1789 township two lots were to be reserved, the first 
marked "gospel and schools," the second known as the "state 
lot." The "gospel and school lot" was to be applied to promote 
the gospel and schools within the said township. An act was passed 
in 1789 which provided for the sale of the "gospel and school 
lot."^^"* This Act of 1789 required the Surveyor- General to set 
apart two lots for gospel and school purposes in each township of 
public land, thereafter to be surveyed.'*^'* The principal tracts of 
land thus reserved included about 47,380 acres."*^^ In time most 
of this land came to be used for the support of schools. Many 
of the funds thus estabhshed continue to the present. 

The "state lot" set aside by the Act of 1786 to be used for 
Literature Fund "promoting literature," was reserved to the state 
Established 1786 ^^ ^^ hereafter applied by the legislature for pro- 
moting literature in the state."^^^ The fund created by the sales 

427 For an account of Rate Bills consult Chap. II. 

■128 It is frequently stated that this fund was established in 1790, e. g., N. Y. State 
Supt. of Public Instruction Report, 1905, p. 61. 

429 Report N. Y. State Supt. of Public Instruction, 1S4S, p. 41 ff. 

430 Laws of New York, 1786, Chap. 67. 

431 For a full history of this fund see Hough, F. B., Historical and Statistical 
Record of the University of the State of New York, Chap. 4, p. 80. 

434 Laws of New York, 1789, Chaps. 32, 44. 

435 Report N. Y. State Supt. of Public Instruction, 1833, P- ^^' 



NEW YORK 351 

of these state lots was the first permanent school fund created 
for an entire state, being nine years older than the Connecticut 
School Fund established 1795. Its purpose was not to aid com- 
mon schools, but to promote academical departments to prepare 
teachers. In the year 1819, $26,690 arrears of quit rents were 
added to this fund, and by an Act passed April 13, 1827, $150,000 
worth of securities belonging to the canal fund were transferred 
to it.^^^ The Act of 1819 directed that "one-half of all quit rents 
and commutations for quit-rents, received by the state, should be 
appropriated to increase the Literature Fund and the remaining 
half to the further increase of the (Common) School Fund." ^^^ The 
control of the Literature Fund rested with the regents of the state 
"until 1832 when it was transferred to the custody of the Comp- 
troller." ^^2 By an Act passed April 27, 1829, the overseers of the 
poor in any town were permitted under certain conditions to appro- 
priate poor funds for the use of common schools, the funds so 
appropriated to be denominated the Common School Fund of such 
town, and to be under the care and superintendence of the town 
superintendent of common schools of such town.^^^" 

The legislature in 1795 enacted that ;^2o,ooo or about $100,000 

be annually appropriated for "encouraging and maintaining 

schools ... in this state in which children shall 

Annual . , . t-. t 1 1 t-. i- 1 

Appropriation be mstructcd m English language, Enghsh gram- 
mar, arithmetic, mathematics." "^^^^ This was 
the first appropriation by the state for common schools. Together 
with the creation of Town Funds it forms the beginning of efforts 
which were expressions of the principle that produced the Com- 
mon School Fund. It was the first recognition of the principle 
that the state is responsible for the education of her future citizens. 
These appropriations expired 1800.^^^" 

*32 Report N. Y. State Supt. of Public Instruction, 1905, p. 62. 

433 Type-written account, six pages, received from N. Y. State Dept. of Finance, 
Dec. 23, 1906. 

435a Laws of New York, 1829, Chap. 287. 

4356 Laws of New York, 1795, Chap. 75. 

435C Randall, S. S., History of the Common School System of the State of New 
York (ed. 1871), p. 96. 



352 PERMANENT COMMON SCHOOL FUNDS 

A condition made necessary by the Act of 1795 for participation 
„ ^ in the annual appropriation was that each town 

Town tax, 1795 . ^^ ^ 

raise by tax a sum equal to one-half the amount 
of public money it received.^^^* 

With the expiration of the annual appropriation, it became 
necessary to provide other means of aiding the schools. Resource 

was had to a method then much in vogue for rais- 

Literature ° 

Lotteries ing money for state and philanthropic purposes, 

I8OI-I82I 1 • o /I 1 T • 1 

and m 1801 an Act was passed directmg that 
$100,000 be raised by means of four successive lotteries of $25,000 
each; $12,500, or one-eighth of the entire amount, to be paid to the 
regents for distribution as they saw fit among the academies, the 
remaining seven-eighths, $82,500, ''to be paid into the Treasury 
for the encouragement of common schools as the legislature might 
thereafter direct." ^^^^ These " Literature Lotteries" did not cease 
until prohibited by the state constitution of 1821, which forbade 
all lotteries.^^^ ** The one-eighth was eventually added to the prin- 
cipal of the Literature Fund, the seven-eighths to that of the Com- 
mon School Fund.'*^^ f 

In view of the fact that -seven-eighths, namely, $82,500, of the 
avails of the Literature Lotteries were eventually added to the 

capital of the Common School Fund it is some- 
Common School 
Fund Established times Stated that this fund originated in 1801.^^^ 

This is hardly correct as there was no provision 
in the Literature Lottery Act of 1801 for establishing its proceeds as 
a permanent fund. It was on April 2, 1805, that the legislature 
finally provided for the estabhshment of the Common School Fund 
by an act which provided that the net proceeds of 500,000 acres of 
unappropriated state lands, the first to be sold after the passing of 
the act, should be appropriated as a permanent fund for the sup- 
port of common schools.^^^^ The act provided that the proceeds 
should be invested until the income should amount to $50,000 when 

435^ Ibid., p. II. 

435 6 Laws of New York, 1801, Chap. 126. 

435/ Hough, F. B., Historical and Statistical Record, etc. (see foot-note 431). 

435<; Laws of New York, 1S05, Chap. 66. 



NEW YORK 353 

that sum should be annually divided among the school districts 
of the state. The act reads: 

"An Act to Raise a Fund for the Encouragement of Common Schools. . . . 

"Be it enacted by the people of the State of New York represented in senate 
and assembly, That the net proceeds of five hundred thousand acres of the 
vacant and unappropriated lands of the people of this State, which shall be 
first sold by the surveyor general after the passing of this Act, shall be and 
hereby are appropriated as a permanent fund for the support of common 
schools. 

"And be it further enacted. That it shall and may be lawful for the comp- 
troller from time to time, to loan all the monies which may come into the 
treasury by virtue of this Act, for a term not exceeding three years, to any 
person or body corporate, for Kterary purposes, on security to be given to the 
comptroller, in the name of the people of this State, by mortgage on improved 
lands within this State, then in the actual possession of the borrower, and of 
double the sum so to be boriiDwed, exclusive of any buildings thereon, which 
paid monies are to be loaned at' the rate of six per centum per annum. 

"And be it further enacted. That it shall and may be lawful for the comp- 
troller to loan on the terms above mentioned, the interest arising from said 
fund, or any part thereof, until the whole interest annually arising from the 
same shall amount to $50,000, after which the interest annually arising shall 
be distributed and applied for the support of the common schools in such 
manner as the legislature shall direct." ^^s? 

When these lands were sold, one-fourth of the purchase money 
was required to be paid down and the balance was allowed to 
Provisions for remain on interest at six per cent, the purchasers 
Sale of Lands ^^ ^^^ ^jj^g q£ ^Yiq sale executing a bond to the 

state for the amount remaining unpaid, payable in six annual 
instalments. ^^^^ The money was loaned to persons or bodies 
corporate for literary purposes, safely secured, until the income 
should reach the distribution limit. 
The constitution of 1777 and the amendment of 1801 contained 
no provision for the support of common schools. 

Constitutional . . , . . 

Provisions, 1821, The first constitutional provision concerning the 

Common School Fund was made by the constitu- 
tion of 1 82 1, sixteen years after the fund had been created by 

^s'i Report N. Y. State Supt. of Public Instruction, 1857, P- 18. 



354 PERMANENT COMMON SCHOOL FUNDS 

the act of legislature. The constitution of 1821, article VII, 
section 10, reads : ^^^ * 

"The proceeds of all lands belonging to this State except such parts thereof 
as may be reserved or appropriated to public use or ceded to the United States, 
which shall hereafter be sold or disposed of, together with the fund denominated 
the Common School Fund shall be and remain a perpetual fund, the interest 
of which shall be inviolably appropriated and applied to the support of Com- 
mon Schools throughout the State." 

Article IX, section i, constitution of New York, amendment, 
1846, reads i*^'^ J' 

"The capital of the Common School Fund, the capital of the Literature 
Fund, and the capital of the United States Deposit Fund, shall be respectively 
preserved inviolate. 

"The revenues of the said Common School Fund shall be applied to the sup- 
port of common schools; the revenues of the Literature Fund shall be applied to 
the support of Academies, and the sum of twenty-five thousand dollars of the 
revenues of the United States Deposit Fund shall each year be appropriated 
to and made a part of the capital of the said Common School Fund." 

The constitution of 1894, article IX, section 3, repeats verbatim 
the provision made in the amendment of 1846. 

The Common School Fund continues to-day to be managed 
by the State Controller as provided for in the 

Management , i. , . i r , a-,^, 

act establishmg the fund. "*^*^ 
The two most important sources of increasing the capital of 
the Common School Fund have been (i) state lands; (2) the revenue 
Growth of Com- of the United States Deposit Fund; besides these 
Eieven'^sCurc^s'^'^' two, many Icss productive sources have been em- 
of Increase ployed: (3) bank stock purchased with accruing 

interest of the school fund;^^^' (4) $949,076 due on loans of 1792 
and 1808^^^™ in exchange for capital of Common School Fund by 
Act of the legislature in 1819;'*^^' (5) $31,624.38 due on loan of 
1786 added to Common School Fund in 1827; ^^5; (5^ $84,358.15 

435i u. S. Commissioner of Education, Report, 1892-93, II, p. 1322. 
435/ Ibid., p. 1330. 

43BA Laws of New York, 1805, Chap. 66, and 1903, Chap. 350. 
435' Report N. Y. State Supt. of Public Instruction, 1857, p. 19. 
i35m Ibid., pp. 20, 21, gives a complete history of these three loans. 



NEW York: 355 

added to Common School Fund in 1845 by Act of Congress 
in 1845, from the United States Treasury surplus; (7) lands 
escheating to the state in the military tract, 1819 (8) receipts from 
quit rents,^^^ 1819, $26,690; (9) arrearages of interest 1819^^^ ';(io) 
net proceeds of Supreme Court fees, 1819;''^^' (11) $82,500 from 
Literature Lotteries proceeds already referred to. 

The chief source of increase prior to 1851 was state lands. The 
original 500,000 acres were exhausted in 1818.^^^ ^ The avails up 
to that date from this source were about $400,000, the total capital 
of the fund being $1,044,889.09.'*^^* The constitution of 1821, 
article VII, section 10, devoted all unappropriated state lands 
amounting to 991,559 acres '^^^ to the Common School Fund. The 
gross receipts from the sale of state lands from 1805 to 1855 
amounted to about $2,500,000, or about three-fourths of the total 
receipts.^^^'* All other sources of increase, quit rents, court fees, 
etc., during the same period had contributed less than $1, 000,000.'*^^'* 

Aside from state lands the most important contributions to the 
Common School Fund have come from the United States Deposit 
United States Fund. The United States Deposit Fund had its 
Deposit Fund origin in New York's acceptance under the provi- 
sions of Chapter 2 of the Laws of 1837 of its share of the surplus 
money of the Treasury of the United States distributed among the 
states of the Union under the 13th section of the act of Congress en- 
titled, "An Act to regulate the deposits of public money," passed 
June 23, 1836,^^^" upon the terms, conditions, and provisions in said 
act contained. By the terms of the act the faith of the state was in- 
violably pledged for the safe-keeping and repayment without inter- 
est of all sums of money received, whenever the same should be 
required by the Secretary of the Treasury of the United States. 
The amount paid in under the above act was $4,014,520.71. ^^^^ 
The legislature of New York accepted the deposit on the terms 
prescribed and made laws as to the character and disposition of 
the fund and its revenue.'*^^ 

435?! Ibid., p. 22. 

4350 Vol. Y, p. 55, Public Statutes at Large, 24th Congress, Session I, Chap. 115. 
435P jsiew York Historical Records, 1885, p. 91. 



356 PERMANENT COMMON SCHOOL FUNDS 

It was provided b}^ an Act passed April 4, 1837, that the money 

should be divided among the counties according to population 

and be loaned by county commissioners appointed 

Investment of 

Principal of by the govcmor and confirmed by the senate. 

The money must be loaned on improved real estate, 
double the value of the loan, exclusive of buildings and of the value 
of rent in perpetuity, if any were charged thereon. As pointed 
out in Chapter III, Part I, the United States had planned to dis- 
tribute the surplus revenue in four instalments, but the fourth 
instalment was never paid. New York, however, loaned the fourth 
instalment in anticipation of its appearance."*^-^' 

Provisions concerning the disposal of the interest of the Surplus 

Revenue Fund were made by an act passed April 17, 1837. The 

first apportionment was to be made in 1839; 

Method of ^ i - i n r • i 

Apportionment $iio,ooo was to be appropriated annually tor aid- 
ing common schools (joined with the income of 
the Common School Fund), to be apportioned among the districts 
in the manner other school moneys were apportioned. In order 
to receive its share, a district must maintain a school taught by a 
duly qualified teacher, four months, instead of three. In the same 
manner $55,000 was to be annually apportioned among the districts 
for three years to be used for purchasing libraries, thereafter for 
the same object or for teachers' wages according as the district might 
decide ;'*^^« $28,000 was to be annually joined with the Literature 
Fund income to aid academies under the visitation of the regents.^^^ 
The remainder of the income was to be added to the principal of 
the Common School Fund.'^^* 

The statutes providing the mode of distribution have been modi- 
fied frequently. In 1846 it was provided by the constitution that 
thereafter $25,000 should be added annually to the principal of 
the Common School Fund.^"^ '' Omitting certain minor educational 
appropriations the statutes in force at the present time provide the 
following annual disbursements: $25,000 to the principal of the 

435? Report N. Y. State Supt. Public of Instruction, 1S48, p. 89; E. G. Bourne, 
History of the Surplus Revenue of iSj^, pp- 86-91. 
^' Constitution of New York, 1846, Art. IV, Sec. i. ^ 



NEW YORK 357 

Common School Fund; $75,000 joined with the income of the Com- 
mon School Fund; $34,000 added to the income of the Literature 
Fund.^33 

In 1897 some important changes were made regarding the school 
finances* of New York. In that year it was enacted that "the 
Merging Revenues Common School Fund, the Literature Fund, the 
Fund*^Common United States Deposit Fund shall continue to 
and°Fre^"°^' consist of all moneys, securities, or other property 

School Fund jj^ ^}-jg treasury of the State, or under the control of 

any State officer, and all debts due the State, or real property 
owned by it belonging to such fund. The proceeds of all land 
which belonged to the State on January i, 1823, except parts 
thereof reserved or appropriated to public use, or ceded to the United 
States, shall belong to the Common School Fund. Of the income 
of the United States Deposit Fund, $25,000 shall annually be added 
to the capital of the Common School Fund; the remainder of such 
income, together with the income of the Common School Fund 
and of the Literature Fund, and also such amounts as may be raised 
or received by taxation or otherwise, or by transfer from any other 
fund, shall constitute the educational fund, and appropriations 
made therefrom may be made only for the support of the educa- 
tional system, to be distributed by the superintendent of public 
instruction, and the University of the State of New York in the 
manner provided for by the law. It shall be the duty of the comp- 
troller to transfer from the general fund at the close of each fiscal 
year such an amount to the revenue of the Common School Fund, 
United States Deposit Fund, and Literature Fund as may be neces- 
sary to reimburse the revenue of said funds by reason of the excess 
of appropriation from the revenue derived from the investment 
of the capital thereof. The moneys so transferred shall become 
and be a part of the educational fund, and be included in the 
amount raised by taxation for the next fiscal year." ^^^^ This law 
in effect combines the revenue derived from the Common School 
Fund, the Literature Fund, and the United States Deposit Fund 
into one annual income devoted to common schools. 

435S Laws of 1897, Art. IV, Chap. 413, Sec. 80. 



358 PERMANENT COMMON SCHOOL FUNDS 

It is impossible to determine how much of the Surplus Revenue 
Deposit Fund that is reported in New York 
annually, actually exists. F. P. Alcott, wrote on 
assuming the duties of controller: 

"In 1877, 1 determined to look into the condition of the fund. . . . So far 
as the investigation instituted has gone, it demonstrates the utter insecurity of 
the fund. . . . Money is loaned upon property not worth double the amount 
of the mortgage (as required by law). Second and third mortgages are taken; 
searches are not made; minutes are not kept . . . forged and fictitious mort- 
gages have been taken, and during the past two years commissioners . . . 

have absconded! . . . The State has to-day thousands of dollars invested 
in farms, the result of foreclosed loans that will not sell for a third of the prin- 
cipal and interest due."^352: 

The difficulty of obtaining correct data is shown by the follow- 
ing conflicting statements: " The United States Deposit Fund is in- 
vested in municipal securities and in mortgages. . . . The fund 
has been kept inviolably intact." ^^^2/ 

"A liberal estimate of the present worth of the $1,442,837.91 held by loan 
commissioners (of the United States Deposit Fund) of the entire state will not 
exceed $1,000,000 of sure assets." ^^sz The losses suffered by the principal of 
the United States Deposit Fund from April 4, 1837, to September 30, 1905, 
amount to $333,862.17 as follows: ^^s^ $199,035.44 lost on resale of lands; 
$56,046.75 lost on foreclosure sale of lands; $33,975-63 lost by failure of title; 
$44,804.38 lost by defalcation of Loan Commissioners. 

The Common School Fund is managed by the 

Management „ 

State Controller.^36 
The present (1906) method of apportionment of the revenue 
of the state school moneys rests upon a threefold 

Apportionment , , ^ 

basis: first, the assessed valuation of the district; 
second, the number of teachers employed; third, population. 

435 1 Ibid., p. 280. 

435X Controller's Report, 1877, p. 28, taken from Bourne, Surplus Revenue, 
pp. 89, 91. 

*35z/ Six-page type-written account furnished by N. Y. State Dept. of Finance, 
Dec. 23, 1906. 

4353 Controller's Report, 1906, p. Ixii. 

436 Laws of New York, 1903, Chap. 350. 



NEW YORK 359 

The money received on the first basis is called the district quota. 
I. "To each district having an assessed valuation* of twenty 
thousand dollars or less, as appears by the report of the trustees 
upon which such apportionment is based, two hundred dollars. 

II. " To each district having an assessed valuation of forty thou- 
sand dollars or less, but exceeding twenty thousand dollars, one hun- 
dred and seventy-five dollars; III. to each district having an assessed 
valuation of sixty thousand dollars or less, but exceeding forty 
thousand dollars, one hundred and fifty dollars; to each Indian 
reservation for each teacher employed therein for a period of 
thirty-two weeks or more, one hundred and fifty dollars; and to 
each of the remaining districts, and to each of the cities in the state, 
one hundred and twenty-five dollars." The amount apportioned 
to a district on the second basis is known as the teachers' quota. 
For every additional teacher duly licensed, the district, city or 
Indian reservation receives $ioo. The remainder of the state 
school moneys left after the apportionment of the district and 
teachers' quotas, and the library moneys, is divided by the State 
Superintendent of Public Instruction among the counties of the 
state in proportion to their population. In counties in which there 
are cities, each city receives its share, and the remainder of the 
county the portion to which such part of the county shall be entitled. 
New York City is considered one county. 

All moneys apportioned from the income of the United States 
Deposit Fund, from the income of the Common School Fund, or 
from school funds, except the library moneys, 
shall be applied exclusively to teachers' wages,'*^'' 
but in view of the fact that "the legislature since 1897 has 
placed the appropriation from the income of the Common School 
Fund and the income from the United States Deposit Fund 
with the free school fund, school taxes, and made them all one 

* "The valuation of the several districts in this state as affected by this appor- 
tionment shall be determined by the commissioner of education from the abstracts 
of the reports of the trustees as filed in his office by the several school commis- 
sioners of the state." Laws of New York, 1906, Chap. 698, Sec. i. 

^ Consolidated School Laws of New York, amended 1903, Title II, Art. I, Sec. 4. 



360 PERMANENT COMMON SCHOOL FUNDS 

fund, it is impossible to say for just what purposes the income of 
the Common School Fund is now used." ^^* 

In order to receive an apportionment from state school moneys, 
(i) counties must have furnished the controller with evidence "that 
Conditions of ^^^ moneys required by law to be raised by taxes 

Participation upon such county for the support of schools 

throughout the state have been collected and paid, or accounted 
for to the state treasurer; ^^^ (2) no district shall be entitled to any 
portion of school moneys unless a common school was supported 
in the district and taught by a qualified teacher for at least 160 
days;^° (3) "The Comrpissioner of Education may withhold 
one-half of all public school moneys from any city or district which 
wilfully omits and refuses to enforce the provisions," relative to 
compulsory education; ^^ (4) "The State Superintendent of Pubhc 
Instruction may withhold its share of public school moneys from 
any city or district which uses school library moneys for any other 
purpose than that for which they are provided;'*^" (5) the public 
school moneys may be withheld from any district or city which 
fails to comply with the legal requirements concerning the teach- 
ing of physiology; ^"^^ or which (6) wilfully disobeys any decision, 
order or regulation pertaining to common schools." ^^ 

438 Extract from letter from Hiram C. Case, Chief of N. Y. Ed. Dept. of Statistics> 
dated Sept. 6, 1904. 
«9 N. Y. Consolidated School Law, 1905, Title II, Art. I, Sec. 3. 
«o Ibid., Art. II, p. 13, Sec. 6, and p. 17, Sec. 15. 

441 Ibid., p. 126, Title XVI, Sec. 10. 

442 Ibid., p. loi. Title XIII, Sec. 8. 

443 Ibid., p. 109, Title XV, Sec. 20. 

444 Ibid., p. II, Title I, Sec, 13. 



CHAPTER XLI 

NORTH CAROLINA 

LITERARY FUND * 

The permanent school fund of North Carolina, officially known 
as the State Literary Fund,^^ now (December, 1906) has a principal 
Present Title of about $300,000.^'' This fund has been derived 

and status chiefly from the sale of swamp lands, together 

with a small amount, less than $50,000, saved from the ruins of 
the Civil War and Reconstruction days. In 1906 it was estimated 
that 700,000 acres ^'^^ of swamp lands remained unsold valued at 
about $250,000. These were considered the only important avail- 
able source of increase among those enumerated in section 4, 
article IX, of the constitution of 1868, but subsequent decisions of 
the Supreme Court deprived the Literary Fund of more than 
600,000 acres which had been claimed for it. The following 
letter from the present State Forester, Mr. W. W. Ashe, presents 
the matter concisely : 

"Raleigh, N. C, November 12, 1908. 
"Prof. F. H. Swift, 

"Dear Sir: In further reply to your letter of October 5th to Mr. Charles L. 
Coon. 

"The lands of the State Board of Education at present do not amount^tOv^ 
more than 110,000 acres. Other holdings which the board claimed have been 
alienated through decisions of the Supreme Court of North Carolina, which 
invalidated tax sales which took place more than eighty years ago. Through 
these decisions the title to the land was held to be still vested in the heirs or 
assigns of the original owners. Since the State Board's claim to most of this 

* For this account I am greatly indebted to data furnished Dec. i8, 1906, by 
Charles L. Coon, Supt. Colored State Normal Schools. Foot-notes 446-447 are 
copied from his statement. 

**5 Public School Laws of N. Car., 1905, Sec. 4093 (p. 13). 

448 Records, OfiSce State Supt. 

447 Ibid. 

361 



362 PERMANENT COMMON SCHOOL FUNDS 

land was based on such tax sales, this decision affects more than 600,000 acres 
which the State Board claimed. 

"The lands which the State Board at present claims consist of one large 
tract of 40,000 acres, which is now held at $4.00 per acre. It can be drained 
and made valuable for farming purposes, there being required an expenditure 
of about $4.00 per acre for main drains and probably $5.00 per acre for minor 
drains and tiling. 

"In addition to this large tract, there are many small tracts, some of which 
will probably be found to be of very little value, while others can probably be 
readily sold at from $3.00 to $5.00 an acre. 

"The Board's holdings have proven so far to be of small value as sources 
of revenue, and since the larger portion of the timbered land was included in 
lands the title to which was invahdated by imperfect tax sales, the future in- 
come of the Board from its remaining lands will be gotten largely by their 
sales for farming. 

"This, I think, covers pretty thoroughly all the questions contained in your 
letter. If there are any others that you wish to ask, I will be very glad to try 
to answer them. 

"Very truly yours, 
"W. W. Ashe, 

"State Forester.^' 

The Literary Fund by an act of the General Assembly, Janu- 
ary, 1903, is now used exclusively for the purpose of building public 
school-houses, under rules and regulations prescribed by the State 
Board of Education, The fund can never be decreased. By the 
Act of 1903, school districts may borrow from the fund an amount 
equal to one-half the cost of a new school building, the amount 
borrowed to be repaid in ten equal annual instalments, together 
with four per cent interest. 

North Carolina first established a permanent common school 

fund known as the Literary Fund in 1825 by Act of General 

Assembly.^* This fund as originally provided for 

was to consist of: (i) dividends from state bank 

and other state stock; (2) taxes on liquor licenses; (3) auction 

taxes; (4) unexpended balance on agricultural fund; (5) all moneys 

4^ No. Car. Rev. Stats., 1836-37, Chap. 66, pp. 378, 379, quotes this law; see 
also Report State Supt. of Public Instruction, 1887-88, p. xxxiii; U. S. Bureau 
of Education, Circular of Information, 1888, No. 2, pp. 166-168. 



NORTH CAROLINA 363 

paid to the state for entries of vacant lands; (6) all the vacant and 
unappropriated swamp lands in the state. In 1827, this permanent 
fund amounted to $12,725. It was increased from time to time 
from the sources indicated above. In 1837 North Carolina re- 
ceived from the federal Government $1,433,727 ^^ as her share 
of the surplus revenue distributed that year. Of this vast sum 
$300,000 was at once added to the Literary Fund '^^ and it would 
appear that eventually all of it except $100,000 devoted to state ex- 
penses, became a part of the school fund.^^^ This large increase in 
the permanent fund enabled the legislature of 1838-39 to undertake 
the establishment of public schools, the whole permanent fund then 
amounting to $1,732,485. In i860 the Literary Fund amounted 
to over $2,000,000. 

The failure of banks in whose stock part of the capital was in- 
vested reduced the fund to less than $1,000,000 in 1869. This 

diminished fund consisted in depreciated rail- 
Loss ^ 

road and navigation stock which was sold at from 
ten to thirty-seven cents on the dollar. The money thus realized 
was invested in the fraudulent North Carolina special tax bonds 
bought at a discount, which were repudiated by the state in 1870. 
The whole school fund was then lost except a few thousand 
dollars. The total loss sustained by the Literary Fund from the 
time of its establishment until the present (1905) may be considered 
to be about $2,525,000 besides interest losses caused by troubles 
of the Civil War and reconstruction periods 1861-70. 

From 1870 to 1903 the sources for increasing the Literary Fund 
have been only those provided by the constitution,'^^^ and are as 
Sources of follows: (i) the proceeds of all sales of federal 

Increase ^sind grants not otherwise appropriated by the state 

or the United States: (2) proceeds of all sales of swamp lands; (3) 
grants; (4) gifts, or (5) devises made to the state and not otherwise 

**9 E. G. Bourne, History of the Surplus Revenue of J'Sj^, P- 91. 
450 Ibid., p. 92. 
*5i Ibid., p. 93. 

452 Constitution of No. Car., 1S68, Art. IX, Sec. 4; Ibid., 1S76, Art. IX, Sec. 4; 
Report U. S. Commissioner of Education, 1892-93, Vol. II, p. 1364. 



364 PERMANENT COMMON SCHOOL FUNDS 

appropriated. During this period the interest on the funds derived 
from these sources was distributed every few years to the several 
counties for general school purposes, the distribution being based 
on school population. By 1903 the fund thus derived amounted 
to $194,159.18, and was set apart for the definite purpose of 
aiding in building school-houses, under the general conditions 
set forth above. 



CHAPTER XLII 
NORTH DAKOTA 

PERMANENT SCHOOL FUND 

Permanent School Fund ^^ is the official title of the permanent 
common school fund of North Dakota. The term Tuition Fund 
Title. is used to include the revenue of the Permanent 

Condition, 1905 School Fund, net proceeds of fines and penalties 
for violation of state laws, rents of school lands, school poll tax 
and school poll state tax. The provisions regarding revenue of 
the Permanent School Fund are provided for under the heading 
of Tuition Fund.^^^ In 1905 the Permanent School Fund con- 
sisted of, first, a reservation of 2,000,000 acres "^^^ of unsold 
school lands, estimated at $20,000,000, the proceeds of which 
when sold will be added to the principal of the fund; and 
second, $8,263,154.80, of which $5,488,170.54 is invested in 
land contracts bearing six per cent interest, and the remainder 
in first mortgages on real estates, state, district and insti- 
tution bonds.^^^ The state has borrowed from the Permanent 
School Fund $711,700, which amount is not necessarily a perma- 
nent debt.^^^ This loan is secured by four per cent state bonds, 
the interest on which, like that on all bonded indebtedness of the 
state, is drawn from a special tax levied upon the property of the 
state for this purpose.'^^ The total income derived from the Perma- 
nent School Fund in 1905 was $337,353/^^ approximately twelve and 
six-tenths percent (.126)* of $2,674,838.75 ^^^ the total receipts for 

* Computed. 

453 The General School Laws of N. Dak., compiled 1897, by Supt. of Public In- 
struction, p. 10, Sec. II. 

454 Ibid., p. 45- 

455 Data furnished by W. L. Stockwell, State Supt. of Public Instruction of 
N. Dak., Sept. 12, 1906. 

365 



366 PERMANENT COMMON SCHOOL FUNDS 

common schools from all sources for that year. Of this annual 
revenue $70,483.46"^^ was derived from the rent of school lands. 
For the benefit of common schools North Dakota was granted 
by the United States Government sections numbered sixteen and 
thirty-six in each Congressional township. "Un- 
der this grant the state will acquire title to ap- 
proximately 2,500,000 acres, . . . the exact acreage cannot be 
determined at this time, as some of the lands in the western part 
of the state have not been surveyed." ^^® Provision was made in 
1889 by the Congressional Enabling Act and the state constitu- 
tion adopted that^^''' year, for the estabHshment of a permanent 
common school fund from the proceeds of these lands. 

The sources provided for increasing the principal of the Perma- 
nent School Fund are at present as follows: (i) proceeds of sales 
Sources of ^f sixteenth and thirty-sixth section lands; ^^^ (2) 

Increase ^^y proportion of the interest or income of the 

school fund not expended during any year; "^^^ (3) five per cent of the 
proceeds of the sales of United States lands lying within the state.^^^ 
The School Fund is managed by the " board of university and 
school lands," composed of the Governor, Super- 
intendent of Public Instruction, Attorney- General, 
Secretary of State, and State Auditor. 

The revenue is apportioned among the counties in proportion 

to their school attendance. The apportionment is based upon 

the number of children between the ages of six 

Apportionment ° 

and twenty who have attended school sixty days, 
"exclusive of those who have attended educational institutions 
maintained strictly by the state." ^^^ 



Objects 



The state Tuition Fund can be expended for 
teachers' wages only, 



460 



456 Commissioner of University and School Lands of N. Dak., Report, 1902-04, 
p. 10. 

4B7 Constitution of N. Dak., 1889, Art. IX, Sec. 153. 

«8 Ibid., Sec. 154. 

459 Enabling Act, Sec. 13, p. 10; The General School Laws of N. Dak., compiled 
1897. 

480 The General School Laws of N. Dak., compiled 1897, Sec. 712. Cf. Sec. 710. 



I 



NORTH DAKOTA 367 

The district to be entitled to receive any portion of the Perma- 
nent School Fund revenue must make a report of the enumeration 
Conditions of ^^ children of school age. Further, the county 
Participation treasurer must have given a bond and oath as 

required by law before the district can receive its quota."*^^ 

*6i Ibid., p. 47, Sec. 714. 



CHAPTER XLIII 
OHIO 

IRREDUCIBLE STATE DEBT 

Ohio, "instead of creating a permanent fund to be loaned . . . 
as was done in Massachusetts (and) Kansas (and) elsewhere, 
Title. early . . . provided that the sales arising from 

Condition, 1905 sixteenth section and other school lands should be 
constituted into a great irreducible debt held forever by the state 
with an annual interest of six per cent to be paid thereon to the dis- 
tricts from which the moneys were originally derived." ^^^ "The 
money derived from the sale of school lands was used for other 
purposes (than schools). As such moneys came into the state 
treasury they were credited to the original township in which the 
lands lay, and deposited in a so-called sinking fund. The interest 
on that amount then goes annually to the school districts located 
all or partly in the original township. The interest is raised by 
state levy. The rent of unsold school lands is added to the annual 
revenue." ^^^ The term State Common School Fund is applied 
to the proceeds of the state tax for schools. (School Law, 1898, 
section 3951.) In 1905 the principal of the irreducible debt 
amounts to $4,902,109.72,^'''* on which the state pays $322,185.70 
annual interest,'*^^ approximately one and six-tenths per cent 
(.0159),* of $20,290,251.26,^'''* the total annual common school 
revenue.f 

* Computed. 

"t" Annual revenue, including balance on hand at beginning of school year, is 
$29,169,670.65. 

*82 Ohio School Report, 1901, p. 9. 

483 School Laws, compiled by State Commissioner of Common Schools, 18 
Sec. 3953. 

*6* Data furnished by Edmund A. Jones, Ohio State Commissioner of Common 
Schools, Oct. 30, 1906. 

368 



OHIO 369 

The funds constituting the irreducible debt were derived chiefly 
from the proceeds of the sales of the following lands: ^^^ (j) section 
sixteen; (2) United States mihtary lands; (3) Virginia military 
lands; (4) Western Reserve lands; (5) swamplands; (6) salt lands ;^^^ 
(7) section twenty-nine, or ministerial lands; and from a part of 
Ohio's share of the United States Surplus Revenue distributed in 

The moneys derived from lands represented to-day by the "irre- 
ducible debt" include the proceeds of the following sales: ^^^ 
Q^. . I. Section sixteen in (i) lands purchased by the 

Ohio Company in 1787; (2) lands purchased by 
John Cleve Symmes in 1787; (3) every congressional township 
granted by Congress in 1803, upon the admission of Ohio into 
the Union; (4) lands originally granted to the Moravians, but 
reconveyed by them to the United States in 1824.'*^^ 

II. Lands granted in heu of section sixteen ^^"^ in (i) U. S. Mili- 
tary Reserve; (2) Connecticut Western Reserve; (3) Virginia Mili- 
tary Reserve, 

III. Ministerial Lands,^^^ i. e., sections numbered twenty-nine 
in the lands purchased by the Ohio Company and by John 
Symmes. 

IV. (i) Swamp lands; ^^^ (2) salt lands.^^^ 

In Chapter III an account has been given of the origin of the 
claims of Virginia and Connecticut to lands in Ohio, and of the 
reservation of sections sixteen for schools and sections twenty-nine 
for the ministry in the Ohio Company and Symmes purchases. It 
will be well here, however, to describe in somewhat greater detail 
the more important areas for which the Ohio Enabling Act of 
1802 made no provision and the subsequent land grants made for 
them.* 
These areas may be named as follows : ^®^ 

* The following description is chiefly a summary of the article referred to m 
foot-note 466. 

465 Ohio School Laws, compiled by State Commissioner of Common Schools, 
1898, Sec. 3952. 

466 "Educational Land Policy of the United States," Barnard's American Journal 
of Education, Vol. 28, pp. 929-938. 



370 PERMANENT COMMON SCHOOL FUNDS 



1. Virginia Military Reservation, reserved by Virginia, 1783 . 3,710,000^ 

2. Western Reserve, reserved by Connecticut, 1784 .... 3,300,000 

3. Ohio Purchase, bought of U. S. by the Ohio Company, 1787 964,285 

4. Symmes Purchase, bought of U. S. by John Cleve Symmes 

1787 311,682 

5. U. S. Military Reservation, reserved by U. S. Government 

1796 2,560,000 

6. Miscellaneous Grants: 
(i) Rupee Grant, east of Scioto River, "granted to certain 

individuals v^ho left British provinces to espouse the 

cause of freedom" 100,000 

(2) Moravian Grant, granted to Moravians for use of Chris- 
tian Indians, three tracts, 4,000 acres each .... 12,000 

(3) Trent Grant, to individuals who had lost lands near 
Gillipolis because of invalid titles 25,000 

(4) Dohmrore's Grant (to a Portuguese merchant for Revolu- 
tionary services), one township 23,040 

(5) Zane's Grant, six sections 3)840 



Total, exclusive of (6), (7) and (8) 11,009,847 

6) Maumee Lands, granted for a government road. 

7) Turnpike Lands, granted to the Columbus and Sandusky 
Turnpike. 

Ohio Canal Lands, granted to the state of Ohio to aid in 
the construction of canals. 

Virginia had promised bounties of lands to her troops which had 
served during the Revolutionary War, Lands which she had 
reserved for this purpose between the Green and Tennessee rivers 
in the present state of Kentucky proved inadequate. Therefore 
when she ceded to the federal Government her territory north- 
west of the Ohio, she reserved to satisfy these bounties the land 
lying in Ohio between the Scioto and Little Miami rivers."*^* 

The origin and location of Connecticut's Western Reserve have 
been described at length elsewhere.'*^^ 

The Ohio Company's purchase was located near and chiefly 
below the mouth of the Muskingum. The first white settlement 
in Ohio was made on this tract at Marietta."*^^ 

*^ Eticyclopedia Britannica, Vol. XVII, p. 758. 

468 "Educational Land Policy of the United States," Barnard's American Journal 
of Education, Vol. 28, pp. 930-932. 
*89 Consult Part I, Chap. Ill; also History of Connecticut School Fund, p. 230. 



OHIO 371 

The Symme's purchase lay between the Great and Little Miami 
rivers.^^^ 

The United States military tract was set aside by an Act of Con- 
gress, 1796, to satisfy certain claims of the officers and soldiers of 
the Revolutionary Army."*^^ 

The location of the remaining grants has been described in the 
tabular statement above, or is not of sufficient importance to be 
described in the present summary account. 

Ohio was the first state to receive for schools from the United 
States the grant of the section numbered sixteen in each congres- 
sional township. But the grant of section sixteen, as provided for in 
the original form of the Ohio Enabling Act * did not apply to any of 
these reservations, sales, and grants. The tract purchased by the 
Ohio Company and that purchased by John Cleve Symmes, to- 
gether amounting to 1,275,967 acres, were the only tracts in which 
section sixteen or lands in lieu of section sixteen had been reserved 
for schools. This left more than 9,000,000 acres — over one-third 
of the state — in which no lands had been granted or reserved for 
schools. 

The situation was rendered more difficult owing to the fact that, 
except in the case of lands surveyed or yet to be surveyed accord- 
ing to the system adopted by Congress, there had been no uniform- 
ity in the system of platting the lands. 

The first reservation, that of Virginia, was not surveyed according 

to any definite mode. Warrants for from 1,000 to 5,000 acres were 

given to an individual, who then located his warrant where he chose, 

had the land surveyed, and then recorded the plat in the Virginia 
office.468 

The Western Reserve was surveyed by Connecticut in townships 
each five miles square. Some of these, known as "Fire Lands," 
were subdivided into quarters of 4,000 acres, and the quarters were 
subdivided according to the choice of their owners.'*^^ 

The United States Military Reservation, like the Western Re- 
serve, was surveyed in townships five miles square. These were 
subdivided into quarters of 4,000 acres, and the quarters into 100- 

* For copy of this Act see Chap. Ill, p. 51. 



372 PERMANENT COMMON SCHOOL FUNDS 

acre tracts, to enable them to be distributed among soldiers having 
loo-acre claims.^''* 

If Congress expected that Ohio would be satisfied with having 
one-third of the state receive no appropriation of federal lands for 
schools, while two-thirds of the state was given one thirty-sixth 
(section sixteen in each township) of its area, it soon learned the 
error of its expectations. 

The constitutional convention of Ohio, in an ordinance passed 
November 29, 1802, proposed as the conditions upon which they 
were willing to accept the propositions previously offered by Con- 
gress, modifications of and additions to the original enabling act of 
such a character as would provide for practically the entire state 
one thirty-sixth of its entire area as a school grant. 

An Act of Congress passed March 3, 1803, accepted the modifi- 
cations and additions.^^*^ Under this and subsequent acts the fol- 
lowing grants were made to Ohio for the use of common schools, 
in lieu of sections numbered sixteen: 

ACRES 

1. In the United States Military Reservation, eighteen quarter town- 

ships, 4,000 acres each* 72,000 

2. In the Connecticut Western Reserve, fourteen quarter townships, 

56,000 acres, granted 1803; 37,758 acres, act of Congress, June, 
1834, to complete the grant of one-thirty-sixth of the Western 
Reserve 93j7S8 

3. For the Virginia Military Reservation, granted 1807, eighteen 

quarter townships and three sections 103,680 

4. One thirty-sixth of Moravian Grant ^^'^ 333 

Total 269,771 

One thirty-sixth of the Ohio Company's and of Symmes' pur- 
chases had been reserved for schools through the grant of section 
sixteen. With the exception, then, of a few small tracts which 
were granted to individuals, one thirty-sixth of the lands of Ohio 

* This area is explained above. 

*'"> Statutes at Large, Vol. II, p. 225. 

471 The Moravian Grant for Christian Indians was reconveyed to the United 
States in 1824, " in consideration of certain benefits to the society and the remnant 
of Indians." 



OHIO 373 

were granted by the United States to Ohio for the use of schools. 
"As there was a small excess granted to the United States Military- 
district, it is probable the deficiency in the private tracts was made 
up." ^^2 

The origin of the grant of saline lands and swamp lands, the 
proceeds of which are represented in Ohio's irreducible debt, has 
been explained previously.* 

The area of the lands the proceeds of the sales of which are repre- 
sented by the irreducible debt may be represented as follows : 

ACRES 

Sixteenth Section Lands 704,488 

Lands in Lieu of Section Sixteen 269,771 

Ministerial Lands area unknown .... 

Saline Lands 24,216*73 

Swamp Lands 117,931.28*^3 

Total area (not including Ministerial Lands) . . . . . 1,116,406.28 

No provision was made in the first constitution of Ohio for the 
establishment of a permanent common school fund. Much uncer- 
tainty existed in the new state as to the owner- 

Establishment of 

Common School ship of the school lands. The Act of Congress 

Fund, 1827 1 -n r 1 o /i-rn i • • i 

passed March 3, 1803,^^'^ vested m trust m the 
legislature all lands appropriated by the United States for the sup- 
port of schools. On the other hand, section sixteen was clearly 
stated to belong to the inhabitants of the township. The legisla- 
ture doubted its right to sell the school lands, and passed at least 
two acts providing for leasing them. In 1803 an act was passed to 
lease the school lands for fifteen years. This act yielded no results. 
Consequently a second act was passed to lease them for ninety-nine 
years, t 
The legislature then applied to Congress for permission to sell 

* Consult Chap. Ill, pp. 58-64. 

t For disastrous effects of this system of long lease, see below, paragraph on 
"Loss." 

472 "Educational Land Policy of the United States," Barnard, American Journal 
of Education, Vol. 28, p. 934. 

*'3 Tables, State Land Grants of Public Lands, p. 8, General Land OflSce, 
Mar. 12, 1896. Consult also Chap. Ill, p. 66, 



374 PERMANENT COMMON SCHOOL FUNDS 

the school lands. Congress made no reply to this request. " The 
legislature felt the necessity of doing something, and accordingly 
in January, 1827, passed an act for the sale of the school lands, 
with such conditions as avoided any question of right as regards the 
people for whose benefit the lands were held. It was provided, 
first, that the sale of section 16, in the original surveys, should be 
voted on by the people of the township, and the sale made if they 
decided so; second, the lands were to be appraised and not sold 
below the appraisement; third, on full payment of the money, a 
deed in fee simple was to be made by the State. The same policy 
was adopted in reference to all the school lands." '^'^ 

In 1827 the first permanent common school fund was established 
by the same legislature, by an act which provided that the proceeds 
of the sales of all school lands and salt lands, together with such 
gifts, donations, devises, etc., as might hereafter accrue should be 
funded by the state at six per cent interest."*^^ 

Ohio received $2,007,260.36 from the United States surplus 

revenue distributed in 1837.^'^^ It is impossible as will appear 

later, to state how much of this has been credited 

United States 

Surplus Revenue, to the irreducible debt. An Act passed March 28, 
1837, provided for loaning the principal to the 
counties, to the state, or to the Canal Fund. In each instance the 
loan was to bear interest at six per cent, and five per cent must be 
devoted to the support of schools.^^^ The sums loaned to the 
counties were later recalled. The money which the state succeeded 
in recovering was used largely to redeem turnpike bonds due in 
1846, to purchase state bonds and to pay the state debt.^'^^ 

March 7, 1838, an act was passed by the general assembly 
which did not establish a permanent fund, but merely guaranteed 
from certain sources an annual revenue of $200,000 for the common 
schools. The act reads : 



*74 "Educational Land Policy of the United States," Barnard, American Journal 
of Education, Vol. 28, pp. 936-937. 

475 E. G. Bourne, History of the Surplus Revenue of 1837 ■, pp. 95-99, 122. (For 
an account of the Surplus Revenue Fund, consult Chap. Ill, pp. 70-78. 

476 E. G. Bourne, History of the Surplus Revenue of 1837, pp. 95, 96. 



OHIO 375 

"Be it enacted by the General Assembly of the State of Ohio, 
"Sec. 3. That there shall be a state common school fund established, 
consisting of the interest on the surplus revenue at five per cent, the interest 
on the proceeds of the sales of lands; the revenue from banks, insurance, and 
bridge companies, and other funds to be annually provided by the state to 
the amount of $200,000 per annum." The basis of distribution was school 
population (4 to 20 years). 

An Act passed March 24, 1851, provided that "the balance of 
the Surplus Revenue Fund shall be added to the common school 
fund.""*" Respecting this, Bourne writes as follows: "This last 
phrase it has been impossible to interpret exactly, for in the school 
reports the Surplus (Revenue Fund) is not mentioned, as the com- 
mon school fund of which it is a part is reported as a unit. It may 
mean the surplus left after paying the turnpike bonds and seven 
per cent bonds of 1851." ^^^ 

It would be difficult to form even an approximate estimate of 
the amount the state school fund has lost through 

Loss , ° 

various causes. The first report of the State Su- 
perintendent of Schools (p. 41) contains the following statement: 

" (School) land has been taken at six dollars per acre worth at the time fifty 
dollars. School lands have been sold at less than a dollar and in some cases 
at less than fifty cents an acre." ^'^^ 

Writes Mayo : 

"There is no more melancholy, and certainly no more confusing, chapter in 
American history than the record of the amazing waste of this great national 
gift to the people of Ohio, as related in the report of Superintendent (Samuel) 
Lewis (first State Superintendent of Public Schools, 1837-1840) and condensed 
in the statement of President E. F. Tappan, of Kenyon College, in his contri- 
bution to the valuable centennial volume of 1875, entitled 'Education in 
Ohio.' 480 

"It is impossible to estimate the amount lost by what would seem to be, 
at the best, the most careless handling of a precious trust. One of the causes 

*''7 The American Almanac, 1S53, p. 297. Repeated in succeeding issues. Refer- 
ence taken from Bourne, as above, foot-notes, p. 98. 

478 E. G. Bourne, History of the Surplus Revenue of iSjy, p. 98. 

479 Quoted from Orth, S. P., The Centralization of Administration in Ohio, p. 32. 

480 Mayo, A. D., The Development of the Common School in the Western States 
from i8jo to 186^, Report U. S. Commissioner of Education, 1898-99, pp. 360, 363. 



376 PERMANENT COMMON SCHOOL FUNDS 

of this was that the mass of the people who through the first generation flowed 
into Ohio were poor, and depended greatly on the low price of pubHc lands 
for a start in life. . . . They were chiefly interested at first in getting the 
lands at a nominal rate and in sending members to the legislature who would 
resist every attempt to wrest the children's patrimony from the hands of their 
hard-working and anxious parents. Much of the land was leased between 
1810 and 1820 at a very low figure for ninety-nine years, with privilege of re- 
newal, though subject to revaluation every twenty or thirty years, with an 
increase of interest. But by the law of 1827, which the superintendent de- 
nounces as 'plunder,' tenants . . . were permitted to surrender their leases 
and, on the payment of the amount of the original appraisement, obtain deeds 
in fee simple. In many cases lands worth $40 and $50 per acre were sold 
for $4 and $6. "480 

This statement should be compared with one made above. 
There it was pointed out that the legislature of Ohio at first doubted 
its right to sell the school lands. When this right had been assumed 
and assured there was something to be said in favor of the law of 
1827, for the increase in the value of the lands was undoubtedly due 
largely to their improvement by those who had leased them; and 
should these men be made to pay for improvements they themselves 
had made ? 

The entire policy of the state of using up the proceeds of school 
lands and establishing a state irreducible debt is open to serious 
question. This topic is fully discussed in Part I of this work. Here 
it is sufficient to say that an evident purpose of granting school 
lands to the state by the federal Government was to lessen the bur- 
den of taxation necessary to support the schools. Ohio, like many 
other states, by using up the principal, compels the people to be 
taxed for the interest, thus making the fund a means of increasing 
rather that of decreasing taxation for schools. 

The present sources for increasing the principal are the proceeds 
of sales of the lands granted by Congress. It is impossible to state 
Sources of ^he acreage of the common school lands remaining 

Increase unsold. "These lands belong to the townships, 

and since the state has no concern except to receive the money 
when the lands are sold, there is no record (kept by the state) of 
the acreage." "^^^ 



OHIO 377 

The revenue is apportioned among the townships and other dis- 
tricts of the country in proportion to their share of the original 
Apportionment. Capital.'**^ The purpose of the fund is stated in 
Objects general terms: "for the support of common 

schools." ^^^ 

In view of the fact that the revenue is regarded as interest paid 
Conditions of upon a debt due to the districts, no conditions 

Participation ^^.^ named which must be fulfilled in order for a 

district to receive its share.* 

* See Idaho, foot-note 122". 

481 School Laws, compiled by the State Commissioner of Common Schools, 
1898, Sec. 3954. 



CHAPTER XLIV 

OKLAHOMA * 

The prospective permanent common school fund of Oklahoma 
is (1905) estimated at $22,000,000, composed as follows: $5,000,000 
on deposit to the credit of Oklahoma in the United States Treasury; 
$17,000,000, the estimated value of unsold common school lands. 
Congress, by Act organizing the territory of Oklahoma in 1890, 
appropriated $50,000 in the aid of public schools.^^^ The following 
year Congress authorized the government of Oklahoma to lease 
the lands granted to the Territory for not more than three years, 
the rents from the leases of these lands to constitute a revenue for 
public schools. Oklahoma possesses 1,413,803 acres of common 
school lands under lease,^^^ estimated as worth approximately 
$17,000,000. The rent yielded by these lands in 1905 amounted 
to $301,026.81,^^^ approximately twenty and one-tenth per cent 
(.2oi6)t of $1,492,862.34,'^^^ the total common school revenue 
derived from all sources. 

Copy 
"Guthrie, Okla., September 13, 1906. 
"Fletcher Harper Swlft, Esq., 
"Dear Sir: 
Your letter of recent date addressed to the Honorable L. W. Baxter, 
Superintendent of Public Instruction, has been referred by him to me. 

"There is at present to the credit of the state of Oklahoma in the United 
States Treasury the sum of five million dollars with interest at the rate of 3% 
from June 16, 1906 (granted for Indian Territory J). This five million dollars 
is granted the state under the statehood bill as a part of the permanent school 
fund, no portion of the principal ever to be used but to be invested as a perma- 

* See also Indian Territory and notes, 
t Computed. 

X See also Indian Territory and notes. 

4S2 Report Supt. of Public Instruction, Okla., 1891-93, p. 5. 
*83 Data furnished Sept. 13, 1906, by Fred L. Wenner, Sec. of Board for Leasing 
School Land. 

378 



OKLAHOMA 379 

nent common school fund. Under the provisions of this same bill the state 
also receives 5% of the receipts from the sale of all public lands vi^ithin the 
territory or state from June 16, 1906, to be also added to the permanent com- 
mon school fund. In addition to this the state has 1,413,803 acres of lands 
reserved for common school purposes, the same being sections 16 and 36 in 
every township, and also some indemnity land granted in lieu of such sections 
where they are lost. 

"The present appraised value of this land is seventeen million dollars in 
round numbers. Under the provisions of the Enabling Act, this land can be 
sold, the proceeds to form a part of the permanent common school fund or it 
can be retained and leased. The Territory has leased its lands for some years, 
the total receipts to date from the leasing of the common school lands having 
been $1,970,702.91. Of this amount $301,026.81 was received during the past 
year, the same being distributed to the various school districts of the Territory 
per capita of school population, the amount per capita for the year being $1.60. 

"In addition to the common school lands, the Territory has 1,372,007 acres 
of lands reserved for the benefit of the higher institutions of learning of the 
Territory. Much of this land is of a poorer character located in the grazing 
districts in the extreme western portion of the Territory, the appraised value 
of the total amount at this time being eight million dollars. 

"I return herewith the sheet of questions and the advance sheet from your 
book with certain notations and corrections thereon. If this does not give you 
what information you desire I will be glad to furnish anything additional. 

"Very respectfully, 

"Feed L. Wenner, 

"Secretary of the Board." 

Copy 

"Ofl&ce of Superintendent of Public Instruction of Oklahoma. 

"Guthrie. 
"Mr. Fletcher Harper Swift, 

"Dear Sir: Yours of July 26th came to hand during my absence from the 
city. Up to this time there is no established school fund except the school 
land fund now owned and controlled by the Territory. I have no copy of the 
Constitution as finally finished by the Constitutional Convention, and cannot 
send you a copy of the section deaUng with the establishment of a school fund. 
The sale of these school lands under the Constitution is checked up to the 
legislature. 

"Very truly yours, 

"J. E. Dyche. 
"8-6'o7. 
"R." 



CHAPTER XLV 
OREGON 

COMMON SCHOOL FUND 

The state permanent common school fund of Oregon is officially- 
known as the Common School Fund.'*^'* In 1906 the Common 
-ji^jg^ School Fund consisted of $4,599,460.39,^®^ and 

Condition, 1906 ^^ reservation of five hundred thousand acres 
(500,000) (1905) of school lands estimated to be worth $1,000,000,^®*^ 
the proceeds of which when sold will be added to the principal of 
the fund. Of the $4,599,460.39 named above, $4,120,747.60 is 
invested chiefly in first mortgage loans and school district bonds; 
the remaining $478,712.70 is made up as follows: $305,794.37 cer- 
tificates of sale of school lands; $154,418.33 certificates of sale of 
land acquired by deed or foreclosure, unsold farms acquired by 
deed or foreclosure $18,500.^®^ The annual revenue amounts 
(1906) to $281,060.86.^®'^ In 1905 the revenue derived from the 
Common School Fund was $272,352.74 which is approximately 
thirteen and five-tenths per cent (.1353) of the total common school 
revenue for that year, $2,012,718.'*®® 

The Common School Fund was established by the first constitu- 
tion adopted by the state and which became effective upon her 
admission into the Union in 1859.'*®'' The original 
capital of the fund consisted of 3,829,706 acres of 
school lands granted by the United States Government, of which 
3,329,706 acres were the sixteenth and thirty-sixth sections in 
each township, and the remaining 500,000 acres ^®'* were lands 
received under the 1841 Act of Congress.^®** 

*84 Constitution of Oregon, Art. VIII, Sec. 2. 

485 Oregon State Treasurer's Report, 1905-06, p. 106. 

488 Data furnished Nov. i6, 1906, by C. S. Moore, Oregon State Treasurer. 

487 Oregon State Treasurer's Report, 1905-06, p. 32. 

488 Report U. S. Commissioner of Education, 1905, Vol. I, p. 306. 

489 Report of State Supt. of Public Instruction of Oregon, iSSo, p. 64, gives the 

380 



OREGON 381 

The sources from which the principal of the Common School 
Fund may be increased are as follows: (i) the proceeds of the sale 
Sources of o^ the sixteenth and thirty-sixth sections of every 

Increase township in the state, or of any lands selected in 

lieu thereof; ^^^ (2) the proceeds of the sale of the five hundred 
thousand acres of land to which the state is entitled by the pro- 
visions of an act of Congress, approved September 4, 1841;'*^^ (3) 
proceeds of property escheating or forfeited to the state; ^^^ (4) 
moneys paid as exemption for military duty; ""^ (5) proceeds of 
gifts, devises, bequests made by any person to the state for common 
school purposes; ^^^ (6) proceeds of all property granted to the state 
when purposes are not stated; ^^^ (7) five per cent of the net pro- 
ceeds of the sales ^^"^ of all federal public lands; (8) ten per cent of 
all proceeds of swamp lands; ^^° (9) the proceeds of the sale of 
tide-lands or sand islands within the state; ^^^ (10) fines imposed for 
violation of laws regulating the practice of medicine,^^® Whether 
the five per cent derived from proceeds of sales of public lands and 
the ten per cent of the proceeds of the sales of swamp lands are 
added to the principal of the Common School Fund as provided 
for by the constitution, I have been unable to determine. The 
State Treasurer, in naming the sources from which this fund is 
derived, omits these two,^^^ and in the same report states that 
the proceeds of these lands are devoted to other objects; but he 
may have considered it unnecessary to speak of these per cent 
funds. 

The State Treasurer estimates that the total loss sustained by the 

Common School Fund from the time of its establishment to the 

present does not exceed $20,000. This has been 

Loss 

caused chiefly by unwise loans on farm property 
and the depreciation in value of security during the depression of 
1893-98. One instance of such loss might be cited. $10,000 was 

total area of school lands originally devoted to the Common School Fund as 
3>377.777 acres. 

490 School Laws of Oregon, compiled by Supt. of Public Instruction, 1897, p. 47, 
Title XIII, Sec. 21. 

49B Oregon State Treasurer's Report, 1905-06, p. 31. 



382 PERMANENT COMMON SCHOOL FUNDS 

loaned to Baker City Academy, This property was taken up and 
disposed of for $1,500 to Baker City School District making a total 
loss of $8,500.^^'^ 

The Common School Fund is managed by a board of commis- 
sioners of school and university lands, composed of the Governor, 
Secretary of State, and State Treasurer. It is 

Management , , / , , , , ,01 

loaned by them at not less than seven per cent. -^^ 

The revenue is distributed by the board of commissioners among 

the counties upon the basis of the total county 

Apportionment 

school population (four to twenty years) .'^^^ 
The revenue of the Common School Fund cannot be used to 
pay for school supplies or buildings or completing or seating school- 
houses ready for occupancy.'*'''- The objects to 
which it may be applied are not specified: "Inter- 
est of the Common School Fund shall be so exclusively applied to 
the support and maintenance of common scliools ... for the pur- 
chase of suitable libraries and apparatus." * 

In order to share in the revenue of the Common School Fund, a 
district must annually report to the county superintendent •^'^^ and 
Conditions of maintain a school one-fourth of the school year 

Participation ^gj,,^y ^^^^g ^j. t^^glve school wecks '^^•*) . The direct- 

ors of a district must require a bond of district clerk not less than 
double the probable amount of all school moneys which shall 
come to his hand.^^^ 

♦Compare, Idaho, foot-note 122". 

491 School Laws of Oregon, compiled by Supt. of Public Instruction, 1897, 
p. 49, Sec. 2. 

492 Ibid., p. 43, Title IV, Sec. 42. 

493 Ibid., p. 33. 

494 Ibid., p. 39, Title V, Sec. 61. 
485 Ibid., p. 25, Sees. 37, 38. 



CHAPTER XL VI 

PENNSYLVANIA 
COMMON SCHOOL FUND 

Pennsylvania possesses no state permanent common school fund. 
The legislature provided for the establishment of such a fund in 
Present Condi- 1831,^^'^ three years before it provided for a state 
tion, Lost system of public schools. Mayo states that in 

1834 the fund amounted to over one and one-half million dollars 
($1,550,000),^^^ but the entire fund appears to have been lost in 
less than forty years, for the school reports in 1870 and 1872 state 
that Pennsylvania has no school fund like many of her sister states, 
but derives all her moneys for public schools from taxation.^^^ 

Section 44 of Pennsylvania's constitution of 1776 provided that 
"a school or schools shall be established in each 

Establishment 

of Free county by the legislature for the convenient in- 

Public Schools . 1 • 1 1 i • 

struction of youth, with such salaries to the mas- 
ters paid by the public as may enable them to instruct youth at 
low prices." ^^^ 

Despite this early constitutional provision, not until 1834 was 
an act providing for a general system of common schools passed.^''^ 
Plowever, this law was largely ineffective, and the real foundation 
of the state system of schools is a law passed in 1836.^°^ The laws 
of 1834 and 1836 left the estabhshment of public schools to the 

497 Act passed Apr. 2, 1831, quoted in full by James Pyle Wickersham, History 
of Education in Pennsylvania, pp. 292-293. 

498 A. D. Mayo, The American Common School, etc., Report U. S. Commissioner 
of Education, 1895-96, pp. 261, 262. 

499 Report U. S. Commissioner of Education, 1870, p. 270; 1872, p. 288. 

500 B. A. Hinsdale, Educational Documents, Report U. S. Commissioner of Edu- 
cation, 1892-93, p. 13 14. 

^1 J. P. Wickersham, History of Education in Pennsylvania, pp. 290-316. 
^2 Ibid., p. 343. 

383 



384 PERMANENT COMMON SCHOOL FUNDS 

option of the district, but in 1848 a law was enacted making the 

maintenance of free public schools compulsory for the entire 

state.^°2 

As early as 1786 Pennsylvania took steps toward establishing 
a permanent common school fund. On April 7th of that year an 
Origin and act was approved entitled, "An Act for the present 

o/commr°* relief and future endowment of Dickinson College 
School Fund i^ ^j^g Borough of Carlisle and County of Cumber- 

land in this State, a7id for reserving part of the imappropriated 
lands belonging to the State, as a fund for the endowment of public 
schools agreeably to the forty-fourth section of the Constitution of 
this Commonwealth^'' ^°^ Section VII of this act reads as follows: 

"Sec. VII. It is therefore enacted, etc., that sixty thousand acres of land, 
part of the unappropriated lands belonging to the State, be and they are 
hereby reserved and appropriated for the sole and express purpose of endow- 
ing pubHc schools in the different counties of this State, agreeably to the said 
forty-fourth section of the Constitution." sos 

Sections VIII, IX, and X made further provisions relative to 
surveying the lands and setting apart the proceeds of the sales as a 
permanent fund.^°'* 

But the public schools never received any benefit from the land 
set apart by this act in their behalf; it was probably given subse- 
quently to county academies.^"^ 

In 1 82 1 Governor Hiester in his message urged the legislature to 
consider the question of uniting with others of the original states 
in demanding of the federal Government an equitable proportion 
of the pubhc lands for the support of schools.^"^ In 1824 Governor 
Schulze spoke as follows: "I would respectfully suggest whether 
an annual sum specially appropriated for that purpose, would not 
in a few years raise a fund equal to the diffusion of the elements of 
education among the children of the repubhc," ^^^ 

In 1827 a bill "to provide a fund in support of a General System 
of Education in Pennsylvania" was passed by the state senate but 

503 Ibid., p. 257. 

504 Ibid., pp. 257, 258. 

505 Ibid., p. 268. 



PENNSYLVANIA 385 

was defeated in the house.^°^ " But/' in the words of Wickersham, 
"the bread thus cast upon the waters returned in a few years in 
the following Act, passed on the second of April, 1831." The pro- 
visions of this Act may be summarized briefly by saying that it 
provided that the proceeds of the sales of certain public lands be 
set apart as a permanent common school fund, to be managed by a 
board of commissioners, the fund to accumulate until its annual 
income should amount to $100,000, after which the interest was 
to be distributed among the school units of the state. The Act 
reads as follows: ^°® 

"Sec. I. That there shall be and there hereby is established a fund, to be 
denominated a Common School Fund, and the Secretary of the Common- 
wealth, the Auditor General and the Secretary of the Land Ofi&ce shall be 
commissioners thereof, who, or a majority of them, in addition to the duties 
they now perform, shall receive and manage such moneys and other things 
as shall pertain to such fund, in the most advantageous manner, and shall 
receive and hold to the use of said fund, all such gifts, grants and donations 
as may be made; and that said commissioners shall keep a correct record of 
their proceedings, which, together with all papers and docimients relative to 
said fund, shall be kept and presei-ved in the office of the Auditor General. 

"Sec. II. That from and after the passage of this Act, all moneys due and 
owing this Commonwealth by the holders of all unpatented lands; also all 
moneys secured to the Commonv/ealth by mortgages or liens on land for the 
purchase money of the same; also all moneys paid to the State Treasurer on 
any application hereafter entered, or any warrant hereafter granted for land, 
as also fees received in the land office, as well as all moneys received in pursu- 
ance of the provisions of the fourth section of an Act entitled 'An Act to in- 
crease the county rates and levies for the use of the Commonwealth,' approved 
the twenty-fifth day of March, 1831, be and the same are hereby transferred 
and assigned to the Common School Fund; and that at the expiration of 
twelve months after the passage of this Act, and regularly at the expiration 
of every twelve months thereafter, the State Treasurer shall report to the said 
commissioners the amount of money thus received by him during the twelve 
months last preceding, together with a certificate of the amount thereof, and 
that the same is held by the Commonwealth for the use of the Common School 
Fund, at an interest of five per cent. 

"Sec. III. That the interest of the moneys belonging to said fund shall be 
added to the principal as it becomes due, and the whole amount thereof shall 
be held by the Commonwealth, and remain subject to the provisions of an 

506 Ibid., pp. 292, 293. 



386 PERMANENT COMMON SCHOOL FUNDS 

Act entitled, 'An Act relative to the Pennsylvania canal and railroad,' ap- 
proved the twenty-second of April, 1829, until the interest thereof shall amount 
to the sum of $100,000 annually, after which the interest shall be annually 
distributed and applied to the support of common schools throughout this 
commonwealth, in such a manner as shall hereafter be provided by law." 

It was estimated that the Common School Fund would amount to 
$2,000,000 in ten years. The preamble of "An Act to establish a 
general system of education by common schools" states that on 
April 4, 1835, the School Fund will amount to $546,563.72." ^°^ 
Mayo asserts, as was stated in the opening paragraph of this 
account, that in 1834 the fund amounted to $1,550,000.^^* 

The Act of 1834 (section nineteen), provided that $75,000 be 
appropriated annually for public schools from the income of the 
Common School Fund until the income should amount to $100,000, 
as provided by the Act of 1831.^'^^ 

Pennsylvania received $2,867,514.78 from the United States 
Governments*'^ as this state's share of the surplus revenue dis- 
tribution of 18^7.* Bourne estimates that about 

United States „ r ^■ 1 n i • i 

Surplus $800,000 of this amount was devoted to the aid 

evenue, 13 ^^ pubhc schools; ^^^ $500,000 of this sum was 
set apart as a fund "to be applied by the several districts either 
for buildings, repairing or purchasing school-houses, or for educa- 
tion, as they may deem best." ^^^ It does not appear that this sum 
was set apart as a permanent fund, but rather that the principal 
was expended prior to 1840.^^" 

* For a full account of the surplus revenue distribution consult Part I, Chap. III. 

507 Ibid., p. 313. 

508 Ibid., p. 316. 

509 E. G. Bourne, History of the Surplus Revenue of J^Sjy, p. 99,, 

510 Ibid., p. 102. 

511 Ibid., p. 100. 



CHAPTER XL VII 

RHODE ISLAND 

PERMANENT SCHOOL FUND 

The state permanent common school fund of Rhode Island, 
officially known as the Permanent School Fund ^^^ is invested as a 
Title. distinct and separate fund,^^^ chiefly in town and 

Condition, 1905 (,j^y bonds.^^^ In 1905 the principal amounted to 
$257,414''^^ and the annual interest or income from the same to 
$9,131^^^ approximately forty-five hundredths per cent (.0045)* 
of $2,014,821, the total common school revenue derived from all 
sources in 1905.^^^ 

The Permanent School Fund was established in 1828, by an 
act which appropriated $5,000 as the basis of a permanent fund 
^ . to be increased by revenues from lotteries (lot- 

Origin •' ^ 

teries were abolished 1843), and auctions when a 
balance remained from these two sources after having paid the 
annual appropriations provided for by section i of the same act.^^^ 
Rhode Island received $382,335 ^° as its share of the United States 
Surplus Revenue Loan of 1837. By an Act passed November 5, 
1836, this entire amount was originally devoted to education ^^^ and 
to it was added $4,276 received in 1858 from the federal Govern- 
ment from the proceeds of the sales of federal lands. The principal 

* Computed. 

512 Laws Pertaining to Education, compiled by Commissioner of Public Schools, 
1896, Chap. 30, Sec. i. 

513 Data furnished Dec. 4, 1906, by L. M. Coggeshall, Clerk to the Rhode Island 
State Commissioner of Public Schools. 

514 Rhode Island State Treasurer's Report, 1903, p. 66; Report U. S. Commis- 
sioner of Education gives revenue of state and local funds and rent of school lands 
as $15,223; $9,121 of this is interest on the permanent school fund, $6,102 is 
revenue from local funds and gifts. 

515 Stockwell, Thos. P., History of Public Education, R. I., p. 45. 
616 Public Laws of R. I., passed since 1835, pp. 913, 914. 

387 



388 TERjMANENT COI^IMON SCHOOL FUNDS 

was in part loaned to the towns and in part deposited in banks 
whicli were to pay five per cent interest.^**'" " The state by the close 
of the year 1857 had borrowed all but $155,541 and in January, 
1859, transferred that amount to the Permanent School Fund. To 
this it subsequently added $11,192 surplus state revenue in 1S60," 
making the total amount added to the fund, $166,733.^''^ The 
state appears not to recognize her indebtedness, i. e., she makes no 
payment of annual interest on the United States Surplus Revenue 
but the annual state appropriation for common schools, $120,000, 
exceeds and perhaps may be considered to include, such interest/''^ 
The present sources provided to increase the principal of this 
Sources of ^^^^"^ ''^^'^ ^''^'^'- taxes on auctioneers' fees,^*^ and 

Increase quotas of State school revcnuc forfeited by towns.*^^ 

The fund is managed by the general treasurer 

Management . , , , . - , "" ^o. 

With the advice ot the governor/'-^ 
To the income of the Permanent School Fund must be added 
from the state treasury an amount sufficient to make the total, a 
sum lixed bv law ($120,000, 1905). This total 

Apportionment 

IS denominated ''teachers money and is appor- 
tioned on a twofold basis as follows: (i) $100 to each school in 
every town not to exceed more than fifteen in any one town; 
(20) the remainder on the basis of town school population (^iive to 
fifteen years.)^^ 

''Teachers' money including the revenue of the Permanent 

School Fund can be used solelv for the pay- 

ment of teachers wages. ""-^ 
In order to participate in the revenue, the town must raise by 
Conditions of local tax an amount equal to the share it receives 

Participation ^^.^^^ ^hc state.^'""* 

517 E. G. Bourne, History of Surplus Revenue of iSjy, pp. 103-106. 

51S Report U. S. Commissioner of Education, 1S06-07, p. 642; also E. G. Bourne, 
History of the Surplus Rn'cnue of J'Sjy, p. 105. 

619 School Law, p. 15, Chap. 30, Sec. 2. 

sao Ibid., p. 30, Chap. 53, Sec. 5, also p. 15, Chap. 30, Sec. 3. 

521 Ibid., p. 15, Chap. 30, Sec. i. 

5^' Ibid., p. 3S, Chap. 53, Sec. 2. 

523 Ibid., Sec. 3. 

52* Ibid., Sec. 4. 



CHAPTER XL VIII 

SOUTH CAROLINA 

PERMANENT SCHOOL FUND 

The permanent state common school fund of South Carolina 
is known officially as the Permanent School Fund/'^'^ This title 
Title. appears to be based on usage and not on any 

Condition, 1906 legislative provision. "Our ^jcrmanent fund is 
practically nothing and is not regarded as a part of the public 
school fund in making up our statistics." ^'''^''' The principal of 
this fund in 1906 amounted to about $46,000-'''^^ yielding $2,251.74 
annual interest at four per ccnt/'^^ which is approximately sixteen 
hundredths per cent f.ooi6j"-'' of $1,372,063, the total common 
school revenue derived from all sourccs.''^^ 

"This interest is now used only for Teachers' 

Objects ' •' 

Institutes."-'-^ 

South Carolina appears to have established a permanent school 

fund in 181 r, but little, if any, reliable information concerning it 

has been available. Section 11, article X, of the 

Origin 

constitution adopted in 1868 ^''^'^ provided that 
"The proceeds of all lands that have been or hereafter may be 
given by the United States to this state for educational purposes, 
and not otherwise appropriated by this state or the United States, 
and of all lands or other property given by individuals, or appro- 
priated by the state for like purposes, and of all estates of deceased 
persons who have died without leaving will or heir, shall be securely 

* Computed. 

5*2^ Report S. Car. State Supt. of Education, 1903, p. 185. 

528 Extract from personal letter written Dec. ii, igo6, by W. H. Barton, Chief 
Clerk, S. Car. Department of Education. 

527 Data furnished by S. Car. State Treasurer, R. H. Jennings, Dec. 19, 1906. 

528 Report U. S. Commissioner of Education, igo6. Vol. I, p. 306. 

529 Report U. S. Commissioner of Education, 1892-93, p. 1359. 

389 



390 PERMANENT COMMON SCHOOL FUNDS 

invested and sacredly preserved as a state school fund, and the 
annual interest and income of said fund, together with such other 
means as the general assembly may provide, shall be faithfully 
appropriated for the purpose of establishing and maintaining free 
public schools and for no other purposes or uses whatever." ^^^ 

The Permanent School Fund is managed by 

Management ^ ^ 

the State Treasurer.^^° 
The principal may be increased by moneys derived from the 
following sources :^^^ (i) grants of land or gifts of money made to 
Sources of the State for educational purposes; (2) all gifts to 

Increase ^]^g g^g^^-g ^y];jei-e ^he purpose is not designated; (3) 

all escheated property; (4) net assets or funds of estates or copart- 
nerships in the hands of the court of the state where there has been 
no claimants for the same within the last seventy years; (5) money 
resulting from the refunding of the direct-tax Act of Congress 1891; 
(6) liquor licenses except so much as is allotted to counties and mu- 
nicipal corporations. 

530 School Law of S. Car., 1896, p. 9, Sec. 5. 

531 School Law of S. Car., 1896; Constitution of 1895, Report U. S. Commis- 
sioner <of Education, 1896-97, p. 648. 



m 



CHAPTER XLIX 

SOUTH DAKOTA 

PERMANENT SCHOOL FUND 

The permanent common school fund of South Dakota, known 
officially as the Permanent School Fund ^^^ was composed in 1906 
jjjie as foUov/s : ^^^ total invested cash principal 

Condition, 1906 $4,807,587; 1,283,910 acres of leased school lands 
valued at $19,258,650; and 918,844 acres of unleased school lands 
valued at $9,188,440, making the total value of the fund, invested 
and prospective, $33,254,677, Ten dollars per acre is provided by 
the state constitution as the minimum sale price.^^^ In some cases 
the lands may have to be disposed of for less than this, but this would 
require a constitutional amendment. In other cases they are sell- 
ing for $40 and $50 per acre so that $10 per acre is a conservative 
estimate.^^"* The average price per acre received in 1905 was 
slightly over $26.^^'* The fund has been most wisely managed. It 
is kept as a distinct and separate fund. The principal is invested 
in farm loans, school, county, township and municipal bonds.^^' 
The state has never borrowed any portion of the fund, and it has 
not suffered a single loss.^^^ The revenue is so large that many 
school districts depend upon it for the largest part of their support.^^^ 
In 1902 the revenue derived from the Permanent School Fund 
together with the rent of school lands amounted to $357,527,^^^ 
which was approximately seventeen and six- tenths per cent (.176) ^^^ 
of $2,026,576,^^^ the total common school revenue derived from all 

632 Constitution of S. Dak., Art. VIII, Sec. ii; Report U. S. Commissioner of 
Education, 1892-93, p. 1395. 

533 Official statement received Nov. 28, 1906, from M. M. Ramer, S. Dak. State 
Supt. of Public Instruction. 

534 Private letter from S. Dak. State Supt. of Public Instruction, Nov. 8, 1906. 
B36 Report U. S. Commissioner of Education, 1906, Vol. I, p. 306. 

391 



392 PERMANENT COMMON SCHOOL FUNDS 

sources, including taxation for that year.^^^ In 1906 the total com- 
mon school revenue derived from all sources was $2,513,828, of 
which approximately twelve per cent (.1195)* was derived from the 
Permanent School Funds and its lands as follows: from the interest 
on the principal of the Permanent School Fund, $149,846; rent 
of school lands $150,773; total income $300,619.^^^ 

Upon her admission into the Union, South Dakota received 

from the federal Government, 2,150,480 acres of school lands for 

the support of common schools, the same being 

Origin ^^ , , . . , . . f 

the sixteenth and thirty-sixth sections in each 
township.^^^ Her first constitution, adopted November 2, 1889, 
provided for the establishment of a permanent common school 
fund from the proceeds of the sales of these lands.^^^ 

The constitution provides that the following sources shall be 
devoted to increasing the principal of the Permanent School Fund : 
Sources of (i) proceeds of the sales of public lands given by 

Increase ^j^g United States; (2) a certain percentum (five per 

cent, see Enabling Act), to be fixed by law, of the state's share of 
the proceeds of the sales of federal lands lying within the state; (3) 
proceeds of property escheating to the state; (4) proceeds of gifts 
or donations to the state for public schools or not otherwise appro- 
priated by the terms of the gift; (5) all property otherwise acquired 
for the maintenance of public schools by the state.^^^ 

The principal of the Permanent School Fund is distributed 

among the counties which hold and manage their shares as trust 

funds and are responsible to the state for the invio- 

Management 

late preservation of the same,^^^ 

The revenue is apportioned among the public 

Apportionment ^ . 

school corporations in proportion to the school 
population ^^^ (six to twenty-one years) 



540 



* Computed. 

536 Constitution of S. Dak., Art. VIII, Sec. 5. 

537 Report Land Commissioner, 1898, p. vii. 

538 Constitution of S. Dak., Art. VIII, Sec. 2. 

539 Ibid., Sec. 3; Amended School Laws of the Slate of S. Dak., compiled by Supt. 
of Public Instruction, 1901, Sec. 25. 

5*0 Amended School Laws, 1901, p. 12, Sec. 20. 



SOUTH DAKOTA 



393 



"For the maintenance of public schools in the state" ^^7 jg the 
only provision made as to the uses to which the revenue may be 
T ^ , «u- X applied, and neither the constitution nor the laws 

Lawful Objects. ^ ^ 

Conditions of name any conditions which the school corpora- 
Participation . r ^r^ • ^ 

tions must fulfil m order to share in the revenue 

of the Permanent School Fund.* 

* See Idaho, foot-note 122''. 



CHAPTER L 

TENNESSEE 
PERMANENT SCHOOL FUND 

The Laws of 1873 (page 25, section 34), provide that a bonded 
debt against the state of $2,512,500 should constitute the Perma- 
jj^ig_ nent School Fund.^''^ The state pays annually, 

Condition, 1905 q^^ of j^s taxes, six per cent interest on this fund,^^^ 
amounting in 1902 to $137,125.48.^'^ The so-called revenue, there- 
fore, of the Permanent School Fund is nothing more or less than a 
form of state school tax. It might almost be said that the present 
Permanent School Fund has no existence except on the books of 
the state. However, certain means of increasing its principal are 
provided by law, which admits the possibility of accumulating a 
productive capital. The total common school revenue derived 
from all sources amounted in 1902 to $1,883,744.66^^ and in 1905 
to $3,101,847.^^ The interest paid by the state on the Permanent 
School Fund constituted, therefore, approximately seven and three- 
tenths per cent (.0727)* in 1902, and four and four-tenths per cent 
(.044) in 1905, of the total common school revenue in each of these 
respective years. 

In the year 1790, North Carolina ceded to the United States 

the "sovereignty and territory of all lands" within the present 

hmits of Tennessee. Tennessee was admitted 
Origin 

into the Union six years later, 1796, but the federal 
Government retained the title to the public lands lying within the 
new state. In 1802 Ohio was admitted as a state and received 
her sixteenth section school land grant from Congress. But it 

* Computed. 

541 Report Tenn. Supt. of Public Instruction, 1890-91, p. 36; Public School 
Laws of Tenn., 1895, p. 18, Sec. 34. 

542 Data furnished Sept. 16, 1906, by S. A. Mynders, Tenn. State Supt. of Public 
Instruction. 

394 



1 



TENNESSEE 395 

was not until 1806 that a similar provision was made for Tennessee. 
In this latter year the United States ceded to Tennessee the public 
lands lying within the state on which the Indian title had been 
extinguished.^'*^ The grant made by Congress in 1806 read as 
follows: "And the State of Tennessee shall, moreover, in issuing 
grants and perfecting titles locate 640 acres to every six miles 
square in the territory hereby ceded where existing claims will 
allow the same, which shall be appropriated for the use of schools 
for the instruction of children forever." ^^ In the case of Ohio 
the sixteenth section was definitely located by the United States 
survey system and given to the inhabitants of the township in 
which it lay. But Tennessee did not receive its grant of school 
lands until ten years after its admission into the Union and it had 
not been covered by the federal survey system. It was not, there- 
fore, divided into townships six miles square, and the school sec- 
tions, granted by Congress could not be definitely located.^^'* More- 
over, during the ten years between 1796 and 1806 much of the public 
land had been taken up by settlers who had in many cases culti- 
vated the land and now resisted stubbornly the efforts to take these 
lands from them for the schools. One other fact of great impor- 
tance must be noted here, namely, that in the case of Tennessee 
the title to these lands was not vested in the township or district, 
but in the state.^"^ In 1806 the state enacted that the newly ac- 
quired lands should be surveyed and laid out "so as to form 
sections, i. e., tracts of land, as near six miles square as the case 
will admit" and that six hundred and forty acres fit for cultivation 
should be laid off in each such six-mile square division and " appro- 
priated for the use of schools for the instruction of children for- 
ever." ^^^ The act reads: 

"Be it enacted by the General Assembly of the state of Tennessee, That two 
registers of the land ofl&ce shall be appointed by joint ballot of both houses of 

6*3 Report Tenn. Supt. of Public Instruction, 189 1, pp. 24, 26. 

B4* T. P. Thomas, The Public School System of Tenn., U. S. Bureau of Education, 
Circular of Information, No. 5. 1893, pp. 282-283. 

6*5 Laws of Tenn., 1806, Chap, i, Sees. 1-6; Haywood and Cobb's ^Sji Digest, 
pp. 44-52. 



396 PERMANENT COMMON SCHOOL FUNDS 

the General Assembly; . . . One of said registers shall keep his office at the 
seat of government, who shall be denominated the register of the land office 
of east Tennessee; and one shall keep his office at Nashville, and shall be 
denominated the register of the land office west of Tennessee. (4) Each of 
the surveyors by this act appointed and recognized, shall without delay cause 
the part of land within his district, to which the Indian claim has been extin- 
guished, to be divided by north and south lines, run according to the true 
meridian and by others crossing them at right angles, so as to form sections 
as near six miles square, as the case will admit, unless where the line of the 
late Indian purchase, or any other exterior boundary may render it impracti- 
cable, and then this rule shall be departed from no further, than such particu- 
lar circumstances may require. The corners of the sections shall be marked 
with progressive numbers from the beginning; each distance of a mile between 
the said comers, shall also be distinctly marked, with marks differing from 
those of the corners and the lines of the sections distinguished by marks differ- 
ing from other lines; and it shall be the duty of the surveyors respectively to 
cause to be marked on a tree near each corner made as aforesaid, and within 
the section, the number of such section; and the said deputies shall carefully 
note in their respective field books, the names of the corner trees marked, and 
the number so made. (6) After ascertaining the claims as aforesaid, the prin- 
cipal surveyor shall cause to be laid off and sui-veyed with plain marked lines, 
six hundred and forty acres of land in one or more tracts, which shall be fit 
for cultivation and improvement, and which shall be as near the center of 
each section as existing claims and the quality of the land will admit, which 
shall be appropriated for the use of schools for the instruction of children, 
forever, agreeably to the provisions of the before recited act of Congress, which 
also shall be placed in their proper places in the general plan. And in any 
section where it may appear that there is not land sufficient fit for cultivation 
for the use aforesaid, the surveyor shall certify the truth of the case to the next 
General Assembly, in order that the legislature may make provision for every 
such section, which may be in the whole or in part deficient." ^^ 

The policy pursued from 1806 to 1824 was to lease the common 
school lands through commissioners appointed by the county 
courts.^^^ 

In 1825 was made the first provision for their sale, but an act 
passed the following year postponed the sale until certain suits 
regarding the title to the lands should be settled.^^'^ In 1827 ''a 

5«Laws of Tenn., 1817, Chap. 67; Tenn. Laws, 1821, Chap. 67; Haywood and 
Cobb's iSji Digest, pp. 159-161. 

5*7 Laws of Tenn., 1825, Chap. 85; 1826, Chap. 64; Haywood and Cobb's Digest, 
pp. 166-168, 



TENNESSEE 397 

general school law was enacted to consolidate all schools funds 
into one common school fund appropriated to the encouragement 
and support of common schools forever." ^^^ This fund was 
entitled the Common School Fund.^"** The law provided that the 
Common School Fund was to consist of the proceeds of the sales 
of school lands, escheats, gifts, 6,000 acres of land given by John 
Rice; 400 shares of Knoxville State Bank stock; proceeds of intes- 
tate estates, and various other items.^'** The constitution of 1835 
(article XI, section 10) provided that the Common School Fund 
shall remain a perpetual fund for common schools.^^* 

On October 24, 1836, the state provided for accepting its share 

of the United States Surplus Revenue to be distributed among the 

states by the federal Government in 18^7. Ten- 

United States / ^' 

Surplus Revenue ncssec's share amounted to $1,433,757, though 
whenever the amount is mentioned in the state 
reports it is given as $1,353,209. On January 19, 1838, was passed 
"An Act to establish a State Bank, to raise a fund for internal im- 
provements, and to aid in the establishment of a system of educa- 
tion." The State Bank provided for by this Act was capitahzed 
at $5,000,000, consisting of the School Fund, the Surplus Revenue, 
and the unexpended interest thereon, the proceeds of the sales of 
the Ocoa lands, and of enough loans in addition as were neces- 
sary to complete the $5,000,000. It was provided that there should 
be appropriated annually from the dividends of the bank $100,000 
for common schools and $18,000 for academies. This annual ap- 
propriation may be regarded as the interest on the School Fund and 
on the Surplus E.evenue Deposit, invested in bank stock. The 
Surplus Revenue was not, however, considered a part of the prin- 
cipal of the School Fund; on the contrary, at this time it is named 
as a resource for paying the state debt if the federal Govern- 
ment should fail to recall it.^^*' 
From the very beginning the management of the lands granted 

54S Laws of Tenn., 1827, Chap. 64; Haywood and Cobb's iSjz Digest, p. 169. 

549 Quoted in Report U. S. Commissioner of Education, 1899-1900, Vol. I, p. 
556. 

550 E. G. Bourne, History 0/ the Surplus Revenue of ^Sjy, pp. 110-115. 



398 PERMANENT COMMON SCHOOL FUNDS 

to Tennessee for public schools was unsystematic and lax. The 
claims of those who had settled on the lands 

Loss 11. 

previous to 1806, and their opposition to the sale 
of these lands has already been referred to.^^^ The weakness and 
lack of centralization in the official management of schools was a 
second cause of loss. "Every distribution of the public school 
funds (prior to 1868) was compelled to run the gauntlet of ten 
different officials before it reached the district school-house. It 
is not necessary to infer that it was fraudulently appropriated, but 
there was a score of ways by which it could be 'plundered by a 
thousand hands on its journey to the children' " ^^^ 

Robert McEwen, State Superintendent of Schools, 1836-40, 
succeeded in robbing the Common School Fund of thousands of 
dollars, A committee of seven was appointed by the legislature in 
1839 to examine his accounts. The real condition was revealed 
by an investigation by a committee of five subsequently appointed. 
This committee reported that Superintendent McEwen "was a 
general operator in a variety of Svild cat' schemes, such as banks 
insolvent from the beginning; loans to partners in mercantile 
houses; land companies in Texas and Alabama, with a constant 
reputation for ' note shaving.'" ^^^ During his four years of office 
Superintendent McEwen had borrowed from the Common School 
Fund $121,169. Much of this was never collected. The financial 
affairs of the Department of Education were placed in the hands of 
a receiver "who in the first six months of his administration had 
collected $17,000 of the $121,000 in the hands of the late Super- 
intendent." ^^^ Despite its many vicissitudes the Common School 
Fund is reported to have amounted to $1,500,000 in 1848.^^^ It 
will be recalled that this fund had been made a part of the capital 
of the State Bank of Tennessee, organized in 1838. This bank 
with its nine branches speedily entered upon a career of decline 

651 A. D. Mayo, The Organization and Development of the American Common 
School in the Atlantic and Central States of the South, 1830-60, Report U. S. Com- 
missioner of Education, 1899-1900, p. 554. 

552 Ibid., p. 555. 

553 Ibid., pp. 552-553. 



TENNESSEE 399 

and wreckage in which, of course, the Common School Fund and 
Surplus Revenue Fund were involved. The bank failed during 
the Civil War and with its failure the permanent school funds were 
lost.^^^ In 1873, the act of the legislature referred to in the open- 
ing sentence of this account, recognized the obligation of the state 
to the common school fund, and authorized the governor to sign 
a certificate of indebtedness as a permanent fund, said certificates 
to include the "original fund and the interest that would have 
accrued up to January i, 1873." ^'^^ 

The following sources are provided for increasing the principal 
of the Permanent School Fund: (i) the proceeds of all escheated 
Sources of property; (2) the proceeds of all forfeited prop- 

increase gj.|.y.. ^^^ |-]^g proceeds of all property bought for 

taxes; (4) the proceeds of all intestate estates; (5) gifts to the state 
for public schools when no other purpose is specified by the donor .^^^ 

No specific provision is made in the School Laws for the manage- 
ment of the Permanent School Fund. The State Treasurer is 
required to keep a separate account of all school 

Management ^ , ^, \ 

moneys coming into his hands.^^^ 

The interest on the Permanent School Fund is 

Apportionment 

apportioned among the counties by the Control- 
Ier.5" 

It appears to be left to the judgment of the district directors to 

determine to what objects their share of the interest of the Perma- 

nent School Fund is to be applied. They are 

"to use the school fund apportioned to their 

district ... in such manner as will promote the interest of public 

schools." ^^^ 

The laws appear to name no conditions which must be fulfilled 
Conditions of by a district in order to participate in the interest 
Participation ^f ^^ie Permanent School Fund.* 

* Compare Idaho, foot-note 122". 

554 Ibid., p. 556. 

555 Public School Laws of Tenn., 1895, p. iS, Sec. 34. 

556 Ibid., p. 20, Sec. 41. 

557 Ibid., Sec. 44. 

558 Ibid., p. 9, Sec. 20. 



CHAPTER LI 

TEXAS 
COUNTY SCHOOL FUNDS — iPERMANENT SCHOOL FUND 

Two permanent common school funds exist in Texas, known 
respectively and ofl&cially as the County School Funds and the 
Title. State Permanent School Fund.^^^ In 1905 these 

Cond'ition, 1905 t^vo £^^^^5 together consisted of $52,660,489 and 
a reservation of 13,000,000 acres of unsold school lands, the pro- 
ceeds of which will eventually be added to the principal of these 
two funds.^^° These unsold lands are estimated to be worth 
$13,000,000. The total prospective principal of these two funds, 
therefore, is about $65,660,489.^^*^ Of the above $52,660,489, less 
than one-twelfth, namely, $4,807,297, is theaggregate principal of the 
County School Funds; the remainder, $47,853,192, is the principal 
of the State Permanent School Fund.^^° Owing to the fact that the 
counties manage their own funds, only meager information regard- 
ing them can be given. The principal of the Permanent School 
Fund is invested chiefly in state, county, and school district bonds, 
issued in terms of ten, fifteen, twenty, thirty, and forty years, and 
payable at maturity. These bonds "are absolutely safe, being 
based, except the state bonds, on twenty times their assessed value 
in real estate." ^^"^ The state has borrowed $596,700 (up to Au- 
gust 31, 1906) from the Permanent School Fund, which amount 
is secured as follows : ^^^ 

$216,000 in three per cent state bonds 

354,700 in five per cent state bonds 

26,000 in seven per cent state bonds 

The interest on these bonds is paid out of the state taxes.^^'^ The 
revenue derived from these funds in 1905 amounted to $1,455,049 ^^" 

559 Constitution of Texas, amended 1892, Art. VII, Sec. 5. 
660 Data furnished Nov. 23, 1906, by J. W. Stephens, Texas State Controller. 

400 



TEXAS 401 

and the rent from school lands to $319,294,^^° making a total of 
$1,774,343,* which is twenty-seven and seven-tenths per cent 
(.2769)* of $6,406,333, the total common school revenue derived 
from all sources for that year (data taken from Report of U. S. 
Commissioner of Education, 1905, pp. 410, 411, 419). Many dis- 
tricts in Texas do not levy any local taxes; all such depend for their 
support upon the available school fund a,nd upon the county availa- 
ble funds.^<^° 

The Mexican State of Coahuila and Texas was organized in 1827. 

In 1832 the Texas portion of the population held a convention 

which presented a memorial to the governor and 

Origin of the ^ =■ 

County School the legislature petitioning for a grant of land 

Funds ^^'^ 

from which might be created a fund for the encour- 
agement of primary schools.^^^ In 1833, the state, by a decree of 
May 23 granted four sitios (17,713 acres) for the support of primary 
schools in the department of Nacogdoches. This appears to have 
been the last land grant this Mexican state made for schools.^^^ 

In 1836 Texas established itself as an independent republic. 
Three years later, in conformity to a recommendation made by 
President Lamar, an act was passed which granted to each county 
in the Republic 13,284 acres (three Spanish leagues) for establish- 
ing a primary school or academy in each county .^''^ In 1840 the 
county grant was increased to 17,713 acres (four leagues) .^^^ The 
grant of 1840 was made on the condition that each county devote 
one- half its share to the support of an academy and the other half 
to common schools. Lane estimated in 1899 that the total area 
of the county school lands, including those reserved in eighteen 
unorganized counties, would amount to approximately 10,000,000 
acres.^^^ But Acting Land Commissioner J. J. Robinson, in a 

* Computed. 

561 J. J. Lane, History of Education in Texas, p. 25. 

562 Ibid., p. 26. 

563 Ibid., p. 27. 

564 The account of the origin of these funds is largely taken from J. J. Lane, 
History of Education in Texas, U. S. Bureau of Education, Circular of Information, 
No. 2, 1903, Chap. II, pp. 23-52. Other sources are indicated. 

565 Ibid., p. 38. 



402 PERMANENT COMMON SCHOOL FUNDS 

personal letter, states that the total area of the school lands granted 
to two hundred and thirty-five counties amounts to 4,162,320 acres, 
and adds that ten counties have received no land under this grant, 
and will receive none, for the reason that the land reserved for 
county purposes has been exhausted.^^^ 

The constitution, as amended in 1883, provided that the man- 
agement of the county school lands and the investment of the pro- 
ceeds of the sales of the same shall be intrusted to the respective 
counties.^^^ Lane states that the principal derived from these 
sales is kept in the state treasury .^^^ 

In 1845 Texas was admitted into the American Union. The first 
Permanent School Constitution contained the following provision 
Fund. Origin looking toward the creation of a permanent state 
fund for common schools: 

"It shall be the duty of the legislature to set apart not less than one-tenth 
of the annual revenue of the State, derivable from taxation, as a perpetual 
fund, which fund shall be appropriated to the support of free public schools; 
and no law shall ever be made diverting said fund to any other use; and until 
such time as the legislature shall provide for the establishment of such schools 
in the several districts of the State, the fund thus created shall remain as a 
charge against the State, passed to the credit of the free-common-school 
fund." 567 

In January, 1850, the state made a small grant of land to the 
Public School Fund and in the following month an act was passed 
by which one-tenth of all the annual state revenues were set apart 
for the creation of a permanent common school fund. This 
source was maintained until 1856, although the people "were not 
enjoying any of the benefits of the system of public schools which 
they were endowing." On December 20, 1850, the legislature 
directed the controller to issue $36,000 in five per cent state bonds 
and place them to the "credit of the common free school fund." ^^® 

568 Constitution of Texas, 1883, Art. VII, Sec. 6. 

567 Constitution of Texas, 1845, Art. X, Sec. 2. 

568 Data taken from personal letter dated Oct. i, 1908. 

569 Ninth Biennial Report, Texas State Supt. of Public Instruction, 1893-94, 
pp. xl-xlL. 



TEXAS 403 

A system of free schools was not provided for until 1854.^^^ 
In that year the legislature appropriated $2,000,000 of five per 
cent bonds in the state treasury for a fund to be known as the " spe- 
cial school fund," the interest of which was to be devoted to the 
support of public schools throughout the state.^*^^ 

As the result of an Act passed in 1854 and subsequent acts, 
approximately thirty-six million (36,000,000) acres of land were 
donated by Texas to encourage the construction of railroads.^^^ 
By subsequent acts the grants to the railroads were qualified in 
such a way as to reserve alternate sections for the free school fund."" 

It was a most happy and wise provision which devoted to the 
Permanent School Funds lands lying within " the very heart of the 
railroad grants rather than in some other part of the state. Under 
this wise provision the more the railroads improved their property 
and the more their lands increased in value, the more the state lands 
likewise increased in value." ^'^^ 

The constitution of 1876 set apart these alternate sections as 
a part of the perpetual school fund of the state, and provided also 
that in the future one-half of the proceeds of the sales of public 
lands shall be added to this fund."^ 

In 1883 two million (2,000,000) acres more were granted to free 
schools as the result of an effort to gain the consent of the legis- 
lature to grant one million (1,000,000) acres to the university in 
lieu of lands of which it had been unjustly deprived.^'^ 

The constitution, as amended on September 25, 1883, provided 
for a Perpetual Public School Fund to be constituted of the follow- 
ing funds and lands: (i) all funds, lands, and other property here- 
tofore set apart and appropriated for the support of public schools; 
(2) all the alternate sections of land reserved by the state out of 
grants heretofore made or that may hereafter be made to railroads 
or other corporations, of any nature whatever; (3) one-half of the 

570 Act of 1873, Special Laws of Texas, p. 323. 

671 Quoted from letter received Nov. 11, 190S, from Prof. F. E. Farrington, 
University of Texas. 

572 Constitution of Texas, 1876, Art. X, Sec. 3. 

573 J. J. Lane, History of Education in Texas, p. 28, 



404 PERMANENT COMMON SCHOOL FUNDS 

public domain of the state; and all the proceeds of the sales of 
the same.^^^ 

It is impossible at the present writing to state how much of either 
the capital or the income of the Permanent School Fund has been 
lost since its establishment. Some years ago A. 
J. Baker, in his biennial report, estimated that 
the Permanent School Fund had failed to receive land due it 
amounting to about 9,879,921 acres.^^^ A special committee ap- 
pointed by the legislature to investigate the matter concluded that 
this was incorrect.^^^ 

Charles Rogan, Land Commissioner, in his Report, 1899, writes 
as follows: "The Permanent School Fund has not received its 
share of the public domain, and as some doubt exists as to the 
amount to which it is entitled, I have prepared two tabular state- 
ments . . . from which, in my judgment, the deficiency must be 
determined." In the tabular statements which follow. Commis- 
sioner Rogan gives three estimated areas of the lands due the 
Permanent School Fund in 1899, and which it had not received, 
namely, 4,470,335.27 acres; 6,470,335.27 acres; 7,331,775.27 acres.^" 

The Permanent School Fund has been deprived of a large sum 
of money through selling public lands for less than their real value. 
Under Acts of 1879 and 1881 known as the "fifty cent land acts" 
the price of public lands was reduced to fifty cents an acre; 
2,618,286.10 acres were sold at this price, the proceeds of one-half, 
1,309,143.05 acres, being added to the Permanent School Fund.^'^* 

In the years 1899 to 1900 the nominal income of the fund was 
$1,157,000; the real income amounted to about $885,000. The 
loss was due to the fact that about $275,000 per year of interest on 
land notes was not paid. The defaulted interest amounts (1900) 
to at least $700,000.^''^ 

57* Constitution of Texas, 1883, Art. VII, Sec. 2; B. A. Hinsdale, Documents Illus- 
trative of American Educational History, p. 1381. 
^75 J. J. Lane, History of Education in Texas, pp. 41, 42. 

576 Ibid., pp. 43, 44. 

577 Report of Texas Commissioner of the General Land Office, 1899, p. 21. 

578 Ibid., pp. 24, 25. 

679 Report Supt. of Public Instruction of Texas, 1899-1900, p. xlvii. 



TEXAS 405 

The chief sources from which the permanent common school 
funds of Texas have been derived may be represented briefly as 
follows : 

ACRES 

County School Funds, lands granted prior to 1906 4,162,320568 

Permanent School Fund, alternate sections granted prior to 1S75 14,025,024 563, 565 

Permanent School Fund, special grant, 1883 2,000,000 ^73 

Permanent School Fund, surveyed 1S76-99 21,865,714.11580 

42,053,058.11 
Appropriations ("three to iive million dollars") $4,000,000 58i 

The sources which are provided for increasing the capital of 
Sources of ^^^ Permanent School Fund and the County 

Increase School Funds are the proceeds of the lands set 

apart for these respective funds by the constitution.^'^^ 

The County School Funds are managed by the counties to 

which they belong. The Permanent School Fund is managed by 

the State Controller,^^^ as a member of the State 

Management 1 • i 

Board of Education, which is authorized, under 
the direction of the legislature, to invest the proceeds of the Perma- 
nent School Fund lands.^^"* 

The revenue is apportioned among the counties on the basis 

of school population by the State Board of Edu- 

Apportionment 

cation, consisting of the Governor, Secretary of 
State, and the Controller.^^^ 
The revenue must be used for the support of public schools. 
The specified obiects for which it must be used 

Objects. . 

Conditions of and the conditions which must be fulfilled in order 

Participation , . . i • 1 t 1 

to share m it are not stated m the laws or the 
constitution.* 

* Cf. Idaho foot-note 122'^. 

580 Report of Texas Commissioner of the General Land Office, 1899, p. 21. 

581 Subject to correction. 

582 Constitution, 1883, Art. VII, Sees. 2, 4, 6. 

583 Ibid., Sec. 4. 

584 Report Supt. of Public Instruction, Texas, 1899-1900, p. xii. 



CHAPTER LII 

UTAH 

STATE SCHOOL FUND 

The Utah permanent common school fund, ofi&cially known as the 
State School Fund,^^^ consisted in 1902 of $291,205 ^^'^ and a reser- 
Titie Condition nation of (i) 65,908 acres of leased lands esti- 
1902 and 1904 ' mated at $96,850 ^«« and (2) 2,026,318 acres of 
unleased school lands, estimated at $2,026,318^*'^ making the total 
prospective value of the fund $2,414,373.* The principal of the fund 
is intact. It is invested chiefly in school district bonds, municipal 
bonds and first mortgages on improved farms. The rent derived 
from the leasing of school lands is added to the annual revenue of 
the fund.^" In 1902 the rent from school lands amounted to 
$24,412.92 ^^'^ and the annual interest on the principal of the fund to 
$324,343.08,^^^ making the total income from the fund $348,756, 
approximately twenty-one and two-tenths per cent (.212)* of 
$1,645,551.07,^*' the total common school revenue (1902) derived 
from all sources. In 1904 the total common school revenue from all 
sources was $1,927,998.38.^*'^ The revenue of the State School 
Fund exclusive of land rents was $393,038.83,^*' annual rent of 
common school lands, $28,712,^*' total income from State School 
Fund $421,750.83, approximately twenty-two per cent (.219)* of 
the total common school revenue. The reports of the United 
States Commissioner of Education and the state reports do not 
report separately the revenue derived from the State School Fund, 
but include it in state taxes.^'** 

* Computed. 

585 Constitution of Utah, 1895, Art. X, Sec. 3. 

586 Report of U. S. Commissioner of Education, 1902, Vol. T, p. xcii. 

587 Statement received Oct. 22, 1906, from A. C. Nelson, Utah State Supt. of 
Public Instruction. 

406 



UTAH 407 

The State School Fund provided for, pursuant to the provisions 

of the Enabhng Act, by the constitution adopted 1895,^^^ became 

established upon the admission of Utah into the 

Origin 

Union in 1896. The original capital consisted of 
6,007,182 acres of land, the same being composed of sections two, 
sixteen, thirty-two and thirty-six of every township ^^^ granted by 
the United States for the use of schools.^^^ 

The following sources for increasing the principal of the State 
School Fund are provided by the constitution :^^^ (i) proceeds of 
Sources of ^^1 lands granted to the state by Congress for 

Increase common schools; (2) proceeds of all property ac- 

cruing to the state by escheats or forfeitures; (3) all unclaimed 
shares and dividends of any corporation incorporated under the 
laws of the state; (4) proceeds of the sale of timber, minerals, or 
other property from school and state lands other than those granted 
for specific purposes. 

The State School Fund is managed by the State Board of Land 
Commissioners, consisting of Governor, Secretary 

Management , . . 

of State, and five resident citizens, who manage 
the sales of lands and invest proceeds.^^" 
The revenue is distributed among the school districts upon 
the basis of school population ^^^ (six to eighteen 

Apportionment 

years) .^^^ 
The revenue of the State School Fund can be used for teachers' 
wages only.^^^ No district shall receive any apportionment of 
school moneys unless it shall have maintained a 

Objects. ■' 

Conditions of school for at Icast twenty weeks during the next 
preceding year; fire, flood, and other uncontrol- 
lable causes excepted.^^^ A district must submit to the state super- 
intendent the annual returns required by law.^^^ 

588 Taken from tables of General Land Office, Mar. 12, 1896. 

589 Enabling Act, 1894, Sec. 6, p. 29; Rev. Stats., 1898; Const., 1895, Art. X, 
Sec. 2, p. 56; Rev. Stats., 1898. 

590 Rev. Stats., Utah, 1898, Sees. 2321, 2327. 

591 Ibid., Sec. 1867. 

592 Ibid., Sec. 1868. 

593 Ibid., Sec. 1775. 



CHAPTER LIII 
VERMONT 

PERMANENT PUBLIC SCHOOL FUND 

Permanent Public School Fund is the title provided by law for 
the permanent common school fund of Vermont; ^^^ it is also some- 
fitig_ times referred to ofi&cially simply as the Perma- 

Condition, 1906 j^gj^^ School Fund. In 1906 the principal of the 
fund amounts to $1,120,218.20^'^^ composed as follows; 

United States Deposit Fund $669,086.74 

Huntington Fund 211,131.46 

Spanish War Claims Fund 240,000.00 

The Spanish War Claims Fund is said to be intact. As will be 
explained later, about $535,269.39, eighty per cent of the U. S. 
Deposit Fund, has been absorbed by the towns ^^^ to whom it was 
intrusted in 1837,^^'' leaving as the amount of the fund intact 
$133,817.35. The State Superintendent of Education states in his 
report, 1906,^^* that the Huntingdon Fund is intact, but the Vermont 
Special Commission on Permanent Common School Fund writes : 
" It appears, therefore, that the Huntington Fund was borrowed 
by the state and used and that the state is liable for the same 
subject to six per cent interest." ^^^ The real condition of the 
Permanent Public School Fund appears to be as follows: Funds 

53* Acts of Vermont, 1906, No. 54, Sees, i, 2. 

sas Statement received from Mason S. Stone, Vermont State Supt. of Education, 
July, 1907. 

506 Information furnished by Mason S. Stone, Vermont State Supt. of Education, 
in letter dated Nov. 9, 1906. 

59V Act Nov. 17, 1837. 

598 Extract from p. 13 of advance sheets of Report of Vt. State Supt. of Educa- 
tion, in preparation, Sept., 1906. 

599 Report of the Special Commission on Permanent School Funds of Vt., 1906, 
pp. 21-22. 

40S 



VERMONT 409 

intact, $344,948.81; Diverted or Credit Funds, $775,269.39. These 
latter compose over two- thirds of the entire Permanent Pubhc School 
Fund. The income from them cannot be considered a relief from 
taxation. The income of the Permanent Public School Fund 
is $52,813,'^°° four and nine-hundredths per cent (.0409) of 
$1,289,891,^''" Vermont's total public school revenue for 1905, ex- 
cluding balance on hand and proceeds of bond sales. Some towns 
draw school revenue from '' grammar school lands." '''^^ These are 
"mostly mountain land, set aside by charter and by law for the 
support of grammar schools." ^^^ In 1905, and in 1906 the total 
area of the grammar school lands was estimated to be 25,000 acres, 
the estimated value of the same $175,000 (I7.00 per acre), and 
the income derived from the same about $3,000 annually.^^^- ^^'^ 
The present Permanent Public School Fund was established by 
. an Act of the General Assembly in 1906,^^'* which 

merged into one fund three already existing but 
separate funds. 

"By an act passed November 17, 1825, (i) 'the amount of avails accrued 

to this State, by the late Vermont State Bank,' (2) 'the amount of this State's 

First Permanent funds, accruing from the six per cent on the net profits of 

Common School ^j^g respective banks chartered by this State,' (3) and the 

Fund Established, ^ j y \jy 

1825. Diverted, amount accrued 'from licenses to peddlers' were 'se- 

■"■ ^^ questered and granted to the respective towns in the 

State, for the benefit of common schools, and to no other purpose.^ It was 
further enacted that the State Treasurer should be Commissioner of the fund, 
to receive all accessions and invest the funds in 'productive or national se- 
curities, as he may find opportunity, and be enabled to procure and negotiate, 

600 The Report of the U. S. Commissioner of Education, 1905, pp. 409, 410, 411, 
gives the following data for Vermont: Permanent Common School Funds, state 
and local, $1,120,218; acreage and value and income of unsold school lands, of 
income of permanent school funds and rent of school lands, $52,813. The State 
Supt. of Education states that the income of the Permanent Public School Fund 
is about $50,000, see foot-note 595. It seems safe, therefore, to infer this last amount 
is the income of the Permanent Public School Fund into which these three funds 
were merged in 1906. The report of the Commissioner ignores the grammar 
school lands. It is impossible to state at the present writing v/hether the $52,813 
reported by the U. S. Commissioner of Education includes the rent of the Grammar 
School Land. 

601 Report Vt. State Supt. of Education, 1888, p. 70. 



4IO PERMANENT COMMON SCHOOL FUNDS 

in order that the same may be a productive and accumulating fund.' Also 
it was enacted that 'the accumulating school fund contemplated by this act, 
shall not be diminished, improved, or appropriated to the use of schools, until 
the amount of principal of said fund shall increase to a sum sufficient to yield 
an annual profit and interest, adequate to defray the current expenses of keep- 
ing a good, free, common school in each district, in the respective towns, for 
the period of two months, in each and every year.' " 602 

"In the report of the Commissioners for the Common Schools, made to 
the legislature of 1828 and signed by William Hall, Charles K. Williams, 
Jacob Collamer, B. F. Bailey, and Ephriam Paddock, occurs the following: 
*A school fund has been estabHshed, which is constantly increasing, and 
promises, in a few years, to support a school for some part of the year, in 
every district in the State.' " ^02 

"On September 10, 1845, this fund amounted to $234,900.44, 
and by the time it was covered into the State Treasury by act of 
legislature, November 5, 1845, 'for the use and benefit of the State, ' 
it had approximated $240,000." ^°^ In 1845 the state owed to 
this fund $224,000 and appropriated this fund to pay this debt, 
that is, the state borrowed the fund, and then in 1845 repudiated 
the debt.«°3 

"And so a fund, created and instituted for a special educational purpose, 
was diverted from the service which it was intended to render, and went into 
the pool of general revenues for common current expenses. In a brief historical 
review of Education in Vermont, the report of the U. S. Commissioner of 
Education states in Vol. i, 1897-98, that this fund 'was abolished and the 
amount, $240,000 appHed to the building of a State house.' This probably is 
incorrect. The abolition oj the fund ocairred thirteen years before the recon- 
struction of the present state house. For the reconstruction of the present 
building the state appropriated $70,000 and the citizens of Montpeher pledged 
$100,000. This fund probably was employed in defrayment of state expenses, 
and was abolished on account of the receipt by the State seven years previ- 
ously, of its portion of the United States Deposit Fund to the amount of 
),o86.74." 602 



The United States Deposit Fund was established by an Act 
passed November 17, 1837.^^^ The original capital consisted of 

802 Extract from pp. 11, 12, proof sheets, Report Vt. State Supt. of Education, 
1906. 

803 Report Vt. State Supt. of Education, 1873-74, pp. 439-440. 



VERMONT 411 

),o86.78,®°^ Vermont's share of the surplus revenue distrib- 
uted by the United States to the various states in 1837. This 
United States money was a loan, not a gift, to the states by 
Fund^Estlb^''^ the federal Government. Vermont loaned the 
lished 1837 United States Deposit Fund to the towns who 

were held ''responsible to the State in the same manner that the 
State is responsible to the Federal Government." ^°^ 

"On January 10, 1877, Arunah Huntington, a native of Rox- 
bury, Vermont, died in Brantford, Canada. By provisions of his 
Huntington Fund will, made on the 15th of November, 1876, the 
Established 1884 g^-^^-g Qf Vermont became a residuary legatee to 
the amount of $211,131.46." ^^* In 1884 an Act was passed estab- 
lishing this money as a permanent state fund. In order to partici- 
pate in the revenue a school district must have maintained a school 
the preceding year twenty-eight weeks,^°^ but the laws appear not 
to have named the objects to which towns and districts must apply 
their revenue and the State Superintendent of Education in 1906 
wrote, "It is questionable whether it (the fund) is meeting the 
specific intent of the will." ^^* This fund still remains intact and 
is productive, save for the small amount of $4,000 invested in 
shares and script of the St. Johnsbury and Lake Champlain Rail- 
road. " Mr. Huntington's recommendations in 1876 deserve to-day 
a repetition in this report. He recommended that the state employ 
the capital realized from his bequest in the creation of a * Vermont 
District School Bank' and that the money be invested in mort- 
gages on real estate; all interest to be added to principal until the 
fund was large enough to admit of each county in the state receiv- 
ing $100,000, the income thereafter to be used for the benefit of 
the common or district schools. The whole affair was to be regu- 
lated under laws of the legislature by their trustees. The actual 
law (1905) of the state regarding this fund provided that the State 
Treasurer may convert its securities into cash and that the pro- 

80* Bourne, Edward G., The History of the Surplus Revenue of ^^37, P- 116. 
605 Statement dated Nov. g, 1906, received from Mason S. Stone, Vt. State Supt. 
of Education. 
608 Vt. Revised Statutes, 1894, Title II, Sec. 749. 



412 PERMANENT COMMON SCHOOL FUNDS 

ceeds may be used for the general purposes of the state. The State 
Treasurer must annually apportion six per cent interest on the en- 
tire fund to towns and unorganized towns and gores in the same 
manner in which the interest of the United States Deposit money is 
divided to towns which do not elect trustees of public money. The 
towns, in turn, if containing more than one school district are in- 
structed to divide the money so received in the same manner in which 
state school tax money is distributed, while the town treasurer must 
make annual report of such receipts and the auditor of accounts 
and inspector of finance must make yearly audit, examine and 
certify to the correctness of all transactions and the condition of 
the fund. It appears, therefore that, the Huntington Fund was 
borrowed hy the state and used, and that the stale is liable for same, 
subject to six per cent interest per annum, and that the income, so 
derived, is being passed over to the towns and by them used under 
such local supervision and direction as each supplies. The pay- 
ment of the full amount of school moneys to any school district is 
predicated upon its having actually expended during the preceding 
year for school purposes, other than construction and repair, a 
sum equal to the amount of its school moneys for such year, 
excluding bequests and one-tenth of its grand-list. Having failed 
to do this, its receipt of school moneys is proportionately decreased. 
In fact, therefore, the avails of the Huntington Fund have also 
passed in large degree from under the direct supervision of a state 
educational system, their control vesting in local boards of adminis- 
tration. Inasmuch as the design of the donor was very clearly 
to aid, foster and preserve the district or common school, as he 
termed it in his will, it would seem right to your commission to 
provide by law for the addition of said fund also to the permanent 
common school fund under such regulation by the state and under 
such state system of supervision and control as will tend most 
definitely to conserve and advance the interests of the common 
or district schools." ^^^ 

In 1904 the legislature of Vermont by No. 42, Acts of 1904, 
sequestered "as a permanent fund, for public school purposes, 
the reimbursement to the State of $240,000 for moneys expended 



VERMONT 413 

in the Spanish-American War." The same legislature enacted 
that the governor of the state "shall appoint a commission of 
Permanent Com- ^^^ individuals who shall serve without pay, who 
mon School Fund gh^ii f^^y investigate into and study this subiect 

or Spanish ^ ar •' o ■' ■> 

Claims Fund, from every standpoint, considering like endow- 
1904 

ments already established in sister states, the 

sources from whence such an endowment may be best derived, the 

most satisfactory methods of its investment and the wisest plan of the 

distribution of its revenue, and who shall report their findings and 

conclusions in full detail to the general assembly in October of 

1906, accompanying the said report with a proper 

Public School bill for the consideration of said general as- 

Fund, 1906 

sembly." ^"^ This commission, known as the 
Special Commission on Permanent Common School Fund, was 
composed of the following persons: Joseph A. DeBoer, Charles 
Vermont Special H. Stearns, Justus Dartt, Nelson W. Fisk, Her- 
Perm^nelrcom- "lan P. Simpson, John A. Mead. Their report 
mon School Fund presented to the Vermont legislature of 1906 
recommended the merging of the United States Deposit Fund, 
the Huntington Fund and the Spanish War Claims Fund. The 
bill they presented was slightly modified, then passed by the 
legislature as No. 54 of the Acts of 1906. It will be seen by a study 
of this act, quoted in full at the close of this account, that it " diverts 
the payment of interest, at five per cent, on each town's portion of 
the United States Deposit fund from the town treasury to the State 
Treasury and segregates v/ith this interest the income from the 
Huntington Fund and the War Claims Fund, the aggregate income 
of which is divided among the towns. . . . In case a town has 
not loaned its portion of the United States Deposit Fund to itself 
it is required to collect and pay the same into the State Treasury 
on or before December 31, 1907." "^"^ 

It has been noted above that the state borrowed $240,000 of the 
Permanent School Fund established in 1825, and then in 1845 

607 Act Approved Dec. 9, 1904, Sec. 2. 

608 Vt. Dept. of Education, Circular of Information, 1906, No. 44, p. 

20, 



414 PERMANENT COMMON SCHOOL FUNDS 

appropriated the fund to pay this debt.* The weakness of the Act 
passed November 3, 1842, was that it permitted towns to borrow 
their portions of the United States Deposit Fund 
of themselves for themselves. "If the money 
had been loaned agreeable to the provisions of the first Act * then 
each town would have to-day an investment from which would 
accrue a revenue for the support of schools. But those towns that 
have borrowed the funds of themselves and used such in the build- 
ing of town houses, construction of bridges, repair of roads, and 
paying of debts, — expenses which should have been met at the time 
by direct taxation,— have entailed upon the present generation a 
tax for the payment of interest on the fund." ^"^ An investigation 
carried on by the State Department of Education of Vermont 
in 1906 revealed the fact that eighty per cent of the towns of 
the state have absorbed their portion of the United States Deposit 
Fund;^^^ if we take this as representing roughly eighty per cent of 
the United States Deposit Fund we may consider the amount thus 
diverted to approximate $535,269.39. "In all cases where the 
town has appropriated the money for town purposes, the town pays 
interest on its portion of the fund at the rate of six per cent and such 
revenue is covered into the school funds of the town." ^^^ As long 
as the state and towns continue to pay interest on the principal 
of the permanent school funds which they have borrowed, these 
funds cannot, strictly speaking, be called lost; for they continue to 
be fixed sources of school revenue. Nevertheless, such income 
is to a large extent derived from taxation, so that a tax has been 
entailed upon future generations to pay interest upon funds orig- 
inally created to lessen this tax and to stand as an impregnable 
foundation in periods of critical financial conditions. The impor- 
tance of this fact is recognized in the Act of 1906 creating the perma- 
nent Public School Fund which provides that "whenever at the 
end of any fiscal year there is a surplus in the state treasury over 
and above the liabilities of the State, then such part of said surplus 
shall be paid over to the trustees of permanent school fund as the 
trustees of said fund may determine at a meeting to be called for 
* See above, topic "Origin." 



VERMONT 415 

that purpose until an amount equal to that part of the Huntington 
fund heretofore converted into cash by the state treasurer shall 
have been transferred." *^'^^ 

The total amount of the Vermont Permanent School Fund di- 
verted or lost from 182 5-1905 may be estimated as follows: 

Fund of 1825 $240,000 

U. S. Deposit Fund, absorbed by towns 500,000 

Huntington Fund 211,269 (?) 

Total $951,269 

The management and investment of the permanent school fund 
rests with a committee of three organized by a board of seven 
Management and persous known as " Trustees of Permanent School 
Investment Fund" consisting of the Governor, Lieutenant- 

Governor, State Treasurer and Superintendent of Education ex 
officio, and three persons appointed biennially by the Governor/^^ 
" Said trustees shall invest the permanent public school fund in the 
following named securities only: United States bonds, state bonds, 
bonds of cities and school districts located in the United States, 
excluding territories, and having a population of over twenty thou- 
sand, and bonds of towns, cities and villages in this state whose 
total indebtedness does not exceed five times the amount of the 
grand list." ^^^ 

(i) "Beginning with April i, 1907, a legal school must have an average 
daily attendance of not less than six for twenty-eight consecutive weeks in 
Conditions of order that the town may receive state aid thereon, ^lo 

Participation (2) If in any town the trustees of public money fail to 

collect and pay over to the state treasurer for the trustees of permanent school 
fund such town's share of the United States deposit money as is not already 
loaned to the town to which it has been apportioned within the time limited 
therefor, or (3) if in any town where its share of United States deposit money 
is already loaned to it the trustees of public money fail to pay over, within 
the time limited therefor annually, the five per cent income derived there- 
from, then, in either such event, the income from permanent public school 
fund and the state school tax which would otherwise thereafter be payable 
to such town shall be forfeited to the state and added to the principal of the 

609 Acts of Vt., 1906, No. 54, Sec. 7. 

610 School Laws, Vt. Dept. of Education, Circular of Information, 1906, No. 44, 
p. 19; Acts of 1906, No. 53, Sec. 4. 



4i6 PERMANENT COMMON SCHOOL FUNDS 

permanent public school fund, and such forfeiture shall thereafter be made 
from year to }'car until such town has j^aid over to the state treasurer for the 
trustees of permanent school fund all sums in arrears, with interest thereon 
at the rate of six per cent per annum." "n 

The Permanent Public School Fund may be increased from 
the following sources: (i) forfeitures by towns (as just ex- 
Sourcesof plained) ; ''^^ (2) gifts; ^^^^ (3) bequests; ^'■'^ surplus 

Increase jj^ state treasury at close of fiscal year (cf. para- 

graph on Loss). '^^^^ The income of the Permanent Public School 
Fund shall be used "solely for the support of 

Lawful Uses •^ , r i 

public 'schools." ''^- The law providmg for the 
creation of the Vermont Permanent Public School Fund was 
framed after a careful study of the modes of administering funds 
in the various states. It was enacted one hundred and one years 
after New York and one hundred and sixteen years after Connecti- 
cut had established a permanent common school fund, at a time 
when the relative importance of permanent funds is rapidly de- 
creasing in many states. This act has so many features of interest 
that it seems well w'orth quoting even in an account wdiich pretends 
to be merely a brief summary. 

"It is hereby enacted by the General Assembly of the State of Vermont: 
"Section i. The sum of two hundred fort)' thousand dollars returned by 
the national government to the state in settlement of the civil war claims, the 
Huntington fund, the United States deposit mone}', and such other additions 
as may hereafter be made to the fund hereby established shall be forever held 
intact and in reserve as a permanent public school fund. 

"Sec. 2. A board to be known as trustees of permanent school fund is 
hereby constituted, consisting of the governor, lieutenant governor, state 
treasurer, and superintendent of education, ex officio, and three persons to be 
appointed biennially by the governor, whose term of office shall continue until 
the first day of November of the next biennial 3'ear and until their successors 
are appointed and qualified unless sooner removed by the governor. Said 
trustees shall invest the permanent public school fund in the following named 
securities only: United States bonds, state bonds, bonds of cities and school 
districts located in the United States, excluding territories, and having a 
population of over twenty thousand, and bonds of towns, cities and villages 

6" Vt., Acts of 1906, No. 54, Sec. 11. 
612 ibid., Sec. 13. 



VERMONT 417 

in this state vidiose total indebtedness does not exceed five times the amount 
of the grand list. Said board of trustees is empowered to receive gifts, be- 
quests or additions to such permanent public school fund, and all purchase 
and sales of securities shall be made by, and all securities shall be taken in the 
name of, and so far as possible made payable to the trustees of permanent 
school fund. 

"Sec. 3. Said trustees shall organize by the election of a chairman, secretary 
and a committee on finance of three members, of which the secretary shall 
be one, at a meeting to be held in the executive chamber of the state capitol 
at two o'clock in the afternoon on the second Tuesday of November in each 
biennial year, or at an adjournment thereof, or at a special meeting duly called 
if the organization is not then completed. Regular meetings of the board shall 
be held at such times and places as the members by vote determine. On the 
request of any two members of the board, the secretary shall call a special 
meeting thereof by notice in writing mailed to each member at least three days 
before such meeting, but the board may act without notice of a special meet- 
ing when all are present. 

"Sec. 4. The committee on finance shall by unanimous action make all 
investments of the permanent public school fund and designate depositories 
therefor, and in the name of the trustees shall execute all checks, transfers or 
releases of securities and do all things necessary to the proper management 
of the assets and income of said fund. 

"Sec. 5. The trustees shall receive no compensation for their services, but 
shall be paid their necessary expenses incurred in the performance of their 
duties. 

"Sec. 6. Vacancies among the trustees appointed shall be filled by the 
governor and vacancies in the officers of the board shall be filled by the mem- 
bers at a regular meeting or at a special meeting called for the purpose. The 
secretary shall keep a record of the proceedings of the board and of the com- 
mittee on finance, recording in detail the proceedings of said committee re- 
lating to investments, income and disbursements and the management of the 
permanent public school fund. 

"Sec. 7. Such securities as the state treasurer now holds belonging to the 
Huntington fund shall at once be turned over to the trustees of permanent 
school fund as a part of the pennanent public school fund. On such part of 
the remainder of said fund heretofore converted to the use of the state as shall 
not have been, at the time of the distribution of the income from the permanent 
public school fund in each year, paid over to the trustees of permanent school 
fund as hereinafter provided, six per cent interest shall annually be segregated 
by the state treasurer as a part of the income of the permanent public school 
fund, and such interest shall be distributed like the other income from such 
fund; and, whenever at the end of any fiscal year there is a surplus in the state 



4i8 PERMANENT COMMON SCHOOL FUNDS 

treasury over and above the liabilities of the state, then such part of said 
surplus shall be paid over to the trustees of permanent school fund as the 
trustees of said fund may determine at a meeting to be called for that purpose 
until an amount equal to that part of the Huntington fund heretofore con- 
verted into cash by the state treasurer shall have been so transferred. 

"Sec. 8. The United States deposit money held in the state treasury for 
towns which have not elected trustees of public money and for unorganized 
towns and gores, together with three per cent interest thereon since the last 
distribution, shall be turned over to the trustees of permanent school fund at 
their request and before the distribution of the state school tax in 1907, the 
principal sum for investment as a part of the permanent pubUc school fund, 
and the amount of three per cent interest for distribution with the other income 
from the permanent public school fund. 

"Sec. 9. The trustees of public money of each town shall, on or before 
December 31, 1907, collect and pay over to the United States deposit money 
heretofore apportioned to it to the state treasurer for the trustees of permanent 
school fund, except where such money is at the time of the passage of this act 
loaned to the town to which it was apportioned, in which case the trustees of 
public money may continue annually to loan said money to such town, with 
interest at five per cent per annum, until such time as said trustees see fit to 
collect the same, when it shall immediately be turned over to the state treasurer 
for the trustees of permanent school fund. 

"Sec. 10. The income from the United States deposit money, in those towns 
where such fund is loaned to the town to which it has been apportioned, shall 
annually on or before the tenth day of June, so long as said loan remains 
uncollected, be paid over by the trustees of public money to the state treasurer 
for the trustees of permanent school fund for distribution with the other income 
from said permanent pubHc school fund. 

"Sec. II. If in any town the trustees of pubHc money fail to collect and 
pay over to the state treasurer for the trustees of permanent school fund such 
town's share of the United States deposit money as is not already loaned to 
the town to which it has been apportioned within the time hmited therefor, 
or if in any town where its share of United States deposit money is already 
loaned to it the trustees of public money fail to pay over, within the time limited 
therefor annually, the five per cent income derived therefrom, then, in either 
such event, the income from permanent public school fund and the state 
school tax which would otherwise thereafter be payable to such town shall 
be forfeited to the state and added to the principal of the permanent public 
school fund, and such forfeiture shall thereafter be made from year to year 
until such town has paid over to the state treasurer for the tnistees of permanent 
school fund all sums in arrears, with interest thereon at the rate of six per cent 
per annum. 



VERMONT 419 

"Sec. 12. The trustees of permanent school fund shall be accountable for 
such part of the United States deposit money as is held by them when required 
by the state treasurer on requisition of the United States. 

"Sec. 13. The income only from said permanent school fund shall be 
covered into the state treasury, fifteen thousand dollars of which shall annually 
be divided among the towns, cities and unorganized towns and gores entitled 
thereto, in the same manner as the forty-five thousand dollar reserve fund 
is divided, and the remaining portion of the income shall be divided, 
by the state treasurer, among the towns, cities, and unorganized towns and 
gores according to the number of legal schools maintained the preceding 
year, and such division shall be made at the same time the monies derived 
from the state school tax are now divided. The income thus distributed shall 
be used solely for the support of public schools, and shall, in unorganized 
towns and gores, be divided equally between the several school districts which 
have maintained a legal school the preceding year, and in towns having a 
district incorporated by a special act of the general assembly, as is provided 
for the division in such towns of money received from the state school tax. 

"Sec. 14. The trustees of permanent school fund shall present to the gen- 
eral assembly on the first day of each biennial session a report of their official 
acts, showing the amount and condition of such fund and the securities in 
which it is invested and the amount and distribution of its income. 

"Sec. 15. The auditor of accounts and inspector of finance shall annually 
audit the accounts of the trustees of permanent school fund and the accounts 
of the state treasurer in connection with such fund, examine the securities 
on hand and certify to the correctness of their transactions and the condition of 
the fund, which certificate shall be included in the report of the state treasurer. 

"Sec. 16. The town treasurer shall give credit in his account of the school 
fund for sums received by the town from the income of the permanent public 
school fund. 

"Sec. 17. Section 740 of the Vermont statutes is hereby amended to read 
as follows: 

"Section 740. Said trustees shall manage such money and report the con- 
dition of the same at each annual town meeting. 

"Sec. 18. Sections 737, 738, 741, 742, 743, 744, 749, 750, 751 and 753 of 
the Vermont statutes, and all amendments thereto, No. 42 of the acts of 1904 
and all acts and parts of acts inconsistent with this act are hereby repealed. 

"Sec. 19. This act shall take effect from its passage." 

Approved December 14, 1906. (Quoted from School Laws, Acts of 1906, 
State of Vermont, Dept. of Ed., Circular of Information, No. 44, pp. 21-25.) 



CHAPTER LIV 
VIRGINIA 

LITERARY FUND 

The Virginia permanent common school fund is known officially 
as the Literary Fund.^^^ In 1905 the annual interest on this fund 
rpitig^ amounted to $56,430.82,*^^^ approximately two 

Condition, 190S and three-tenths per cent (.023)* of $2,432,102,^^^ 
the total school revenue derived from all sources for that year. In 
1905 the principal of the Literary Fund amounted to $1,881,027.28, 
and in 1906 to $2,021, 788.60.*^^^ The principal is intact, being 
invested chiefly in Virginia state bonds bearing annual interest at 
three per cent. 

The Literary Fund became established February 2, 1810, by 
an act of legislature, which provided that (i) all escheats, (2) 
conliscations, (3) fines, (4) penalties, (5) forfeit- 
ures, (6) rights and personal property accruing 
to the state as derelict and having no rightful proprietor should 
constitute a permanent fund for the use of common schools.^^^ 
In 181 8 the Literary Fund had reached the sum of $1,000,000.^^^ 

The Literary Fund suffered severe losses from i860 to 1886. 

In 1861 the principal amounted to $1,877,364.68.*^^^ Judge John 

G. Dew, second Auditor of Virginia, reports the 
Loss 

losses as follows : ^^^ diverted during the Civil 

War, $216,000; lost on bank stock during Civil War, $300,000; 

lost on bank stock since Civil War, $50,000; paid to West Virginia 

* Computed. 

613 Va. School Laws, compiled by Board of Education, 1S92, p. 57, Sec. 51. 
61* Statement received Dec. 12, 1906, from Judge John G. Dew, Second Auditor 
of Virginia. Judge Dew has the immediate care of this fund. 

615 A. D. Mayo, Common Schools in the South, 1S30-60; Report U. S. Commis- 
sioner of Education, 1899-1900, Vol. I, p. 432. 

616 Miller, Thos. C, History of Education in West Virginia, p. 29. 

617 Va. School Report, 187 1, p. 199. 

420 



VIRGINIA 421 

as her share of Literary Fund, $719,022.62, 1871, 1886; discount in 
funding, $541,494.10; total amount of lost or diverted principal, 
$1,826,516.72.'^^^ The fund is suffering also because of insufficient 
legislation in respect to the sources of revenue devoted to its 
increase. Joseph W. Southall, State Superintendent of Public 
Instruction, writes in his report for 1904-05 as follows: "This 
fund would be increased far more rapidly if some more stringent 
plan were adopted for the collection of fines imposed for offences 
against the Commonwealth, and the proceeds arising from es- 
cheated property and all waste and unappropriated lands. It is 
safe to say that thousands of dollars are lost every year to this fund 
for lack of a better system of collecting fines and escheating derelict 
property." ^'^ 

The following sources are provided by law to increase the prin- 
cipal of the Literary Fund.''^^ The proceeds of (i) lands granted 
Sources of ^y Congress for public schools; (2) all escheated 

Increase property; (3) all waste or unappropriated lands; 

(4) all property forfeited to the state; (5) fines not otherwise appro- 
priated; (6) donations; (7) such other sums as the general assembly 
may appropriate. Of these seven sources the second, fourth and 
fifth at present contribute most.^^^ 

The Literary Fund is managed by the State Board of Educa- 
tion,^^^ composed of the Governor, Superintendent of Public In- 
struction, Attorney- General, three members of the 

Management ■' 

faculties of the various state educational institu- 
tions and a county and city superintendent.^^^ The second auditor, 
Judge John G. Dew, invests the fund for the Board of Education.^^* 
The revenue is apportioned among the cities and counties 

on the basis of school population (seven to 

Apportionment ^ ^ ^ 

twenty years) .^^^•''2'' 

618 Extract from personal letter dated Sept. 12, 1906, received from J. D. Eg- 
gleston, Jr., Va. State Supt. of Public Instruction. 

619 Va. School Laws, compiled by Board of Education, 1892, p. 36, Sec. 12, 
Subd. 9. 

620 Ibid., p. 70, Sec. 88. 

622 Va. School Report, 1871, App. p. 198; Va. School Report, 1904-05, Part I, 
p. xxxi. 



422 PERMANENT COMMON SCHOOL FUNDS 

The Literary Fund constitutes one of the most valuable assets 

of the commonwealth, as it furnishes the means of the financial 

support of (i) the State Board of Education; (2) 

Objects ^^ ^ ^ , , ' ^ ; 

for the payment of the salaries and expenses of 

the State Board of Examiners; (3) the salaries of the division 
superintendents of schools; (4) the expenses of the summer normal 
schools; and (5) no inconsiderable share of the wages of teachers.^" 
The following conditions must be fulfilled in order to share in it: 
(r) school must be kept in operation five months during the current 
Conditions of year; ^^^ (2) school-houses, furniture, apparatus, 

Participation text-books for indigent children, and all other 

means and appliances for the successful operation of the schools 
must be provided. 

821 Ibid., p. 52, Sec. 44. 



CHAPTER LV 
WASHINGTON 

COMMON SCHOOL FUND 

"Permanent School Fund" is a title frequently given to the 
permanent common school fund of Washington in the state reports, 
Title. but Common School Fund is the title provided 

Condition, 1906 ^iji^g i^y ^i^g constitution and laws."^--' The fund 
consists (October i, 1906) of $1,477,244.07,*^^ besides about two 
and a quarter million acres of unsold school lands.^^ $1,345,000 
of the above amount has been borrowed by the state which pays 
interest on the same at the rate of three and one-half per cent 
(.035).^^ This interest is paid out of state taxes,^^^ in other words, 
the state uses the moneys derived from lands originally donated 
to relieve the people from taxation for the support of schools, and 
then taxes the people to pay the interest. This is a policy followed 
in many other states — the wisdom of it cannot be discussed here.* 
As the surveys of common school lands are not yet completed it 
is impossible to state positively the total acreage.^^® The 1905 
report of the United States Commissioner of Education gives the 
following data for Washington : ^''^ unsold common school lands, 
leased, 888,651 acres, estimated value, $8,000,000; unleased, 
1,362,000 acres. The average price per acre of lands sold thus far 
is stated to be $18.70 ^^^ and as the act enabling Washington to 
become a state (Enabling Act, section 11) forbids any lands to 
be sold for less than ten dollars per acre, it would seem that with 

* On this point read the account of the Minnesota fund, also consult Part I. 
623 Constitution of Wash., 1889, Art. IX, Sees. 2, 3; Sch. Law of State of Wash., 
1901, p. 61, Chap. 6. 
824 State Treasurer's Report, 1904-06, p. 9. 

625 Statement received from R. B. Bryan, Wash. State Supt. of Public Instruction, 
Dec. 21, 1906. 

626 Northwest Journal of Education, Mar., 1906, p. 21. 

423 



424 PERMANENT COMMON SCHOOL FUNDS 

proper management the principal of the fund may eventually 
amount to over twenty-five million dollars. Washington's total 
common school revenue in 1905 derived from all sources was 
$3,648,369 ^^ of which $293,312,^^^ approximately eight per cent,^^' 
was derived from Common School Fund interest and land rent. 
Washington upon her admission into the Union received from 
the United States Government the sixteenth and thirty-sixth sec- 
tions in each township for the use of common 

Origin 

schools. It is estimated this land grant will 
amount to 2,488,675 acres.^" 

The first constitution adopted 1889 provided for the estabHsh- 
ment of the Common School Fund from the proceeds of these lands 
Sources of ^^^ ^^^ proceeds of several other sources as fol- 

increase lows: ^^' (i) appropriations and donations by the 

state to this fund; (2) donations and bequests by individuals 
to the state or public for common schools; (3) proceeds of lands 
or other property reverting to the state by escheat or forfeit- 
ure; (4) proceeds of all property granted to the state when the 
purpose is not specified or is not certain; (5) funds accumulated 
in the state treasury for the disbursement of which provision has 
not been made by law; (6) proceeds of timber, stone, minerals or 
other property from school and state lands other than those granted 
for specific purposes; (7) all moneys other than rent recovered from 
trespasses on said lands; (8) five per cent of proceeds of sales of 
United States Public Lands lying within the state; (9) the principal 
of all funds arising from the sale of lands and other property which 
have been granted and hereafter may be granted to the state for 
common schools; (10) such other funds as the legislature may pro- 
vide. 

The Common School Fund is managed by the State Board of 
Land Commissioners, composed of the Superin- 

Management 

tendent of Public Instruction, Secretary of State, 
and Commissioner of Public Lands.^^^ 

«27 Constitution of Wash., 1889, Art. IX, Sec. 3. 

628 Report Supt. of Public Instruction, Wash., 1902, p. 180; Northwest Journal 
of Education, Jan., 1904. 



WASHINGTON 425 

The revenue is apportioned by the State Superintendent of 
Pubhc Instruction among the counties in propor- 

Apportionment . , ^ i r 1 «9a 

tion to the total number of days of attendance.**^^ 

The objects for which the revenue of the Common School Fund 

shall be used are not specified by law other than 

Objects R, 

that it shall be used for current expenses.^^" 
In order to share in the revenue, the following conditions must 
be fulfilled by the districts: A school must be maintained for at 
Conditions of ItSist five months during the preceding year.^^^ A 
Participation district forfeits twenty-five per cent of its share of 

the school fund revenue if it (i) uses text-books other than those 
prescribed by the proper authorities; ®^^ or (2) fails to comply with 
the prescribed course of study; or (3) issues warrants to a teacher 
not legally qualified.^^^ (4) After June 30, 1906, districts must levy 
a three-mill local tax in order to receive their apportionment of 
school moneys.^^^ 

629 Wash. School Law, 1901, p. 25, Title II, Chap. I, Sec. 22. 

630 Ibid., p. 62, Chap. 6, Sec. no. 

631 Ibid., p. 92, Sec. 174; Laws of Wash., 1905, Chap. 56, Sec. 5. 



CHAPTER LVI 

WEST VIRGINIA 

SCHOOL FUND 

The correct title of the permanent common school fund of West 
Virginia is School Fund,^^^ though it is often called the " irreducible 
Title. fund." ^^^ The principal of the fund is intact. 

Condition, 1905 rj^^Q g|.^^g ]^a^s never borrowed any of the principal 
and cannot do so "because the Constitution forbids the creation 
of any state debt whatever." ^^^ The principal is invested chiefly 
in district, county, and municipal bonds.^^^ In 1902 the principal 
of the School Fund amounted to $1,104,412.69.^^^ "At the general 
election that year an amendment to [the] Constitution was adopted 
which limited the permanent school fund to one million dollars and 
the sources by which it had from time to time been augmented were 
all to be turned into the general school fund (annual school revenue). 
The amount in excess of a million dollars — about $104,000 — was 
distributed as a part of the general school fund in three annual 
instalments, 1903-04-05. (The School Fund now) produces a 
revenue of about $51,000," ^^^ approximately two per cent (.0185)* 
of $2,744,334, the total common school revenue in 1905 derived 
from all sources.^^ The following is a copy of the amendment 
above referred to : Amending section four of Article XII. 

"The accumulation of the School Fund provided for in section four of 
Article XII, of the Constitution of this State, shall cease upon the adoption 

* Computed. 

632 Constitution, Art. X, Sec. i; Report U. S. Commissioner of Education, 1892- 
93, Vol. II, p. 1334. 

633 Report State Supt. of Free Schools, West Virginia, 1906, p. 39. 

834 Statement received from T. C. Miller, W. Va. State Supt. of Free Schools, 
Feb. 18, 1907. 

"36 Report State Supt. of Free Schools, W. Va., 1906, pp. 40-43, table of invest- 
ment securities. 

636 Ibid., p. 38. 

426 



WEST VIRGINIA 427 

of this amendment, and all money to the credit of said Fund over one million 
of dollars, together with the interest on said Fund, shall be used for the support 
of the Free Schools of this State. All money and taxes heretofore payable 
into the Treasury, under the provisions of the said section four, to the credit 
of the School Fund, shall be hereafter paid into the treasury to the credit of 
the general school fund for the support of the free schools of the State." 
(Adopted at general election in West Virginia, 1902.) 

In the year 1863, West Virginia, up to that time a part of Vir- 
ginia, adopted a constitution and was admitted into the Union as 

a separate state. The new state in her first con- 
Ongm * ... 

stitution provided for the creation of a permanent 

fund to be known as the School Fund, the interest of which was to 
be annually applied to the support of free schools throughout the 
state. The sources from which the fund was to be derived and 
increased as provided by the constitution were as follows: (i) 
West Virginia's share of Virginia's Literary Fund and any money, 
stocks or property which could be rightfully claimed from Virginia 
for educational purposes; * (2) proceeds of delinquent waste and 
unappropriated lands; (3) proceeds of lands heretofore sold for 
taxes or purchased by Virginia if hereafter redeemed or sold to 
others than the state; (4) grants, devises or bequests made to 
the state for the purposes of education where the purpose is not 
specified; (5) proceeds of intestate estates; (6) proceeds of escheated 
lands; (7) proceeds of taxes levied on revenue of corporations; (8) 
military exemption moneys; (9) appropriations by legislature; (10) 
any interest of School Fund remaining unexpended at the close 
of the fiscal year. "This fund (the School Fund) was started when 
this state (West Virginia) was organized by laying claim to about 
$120,000 of the Literary Fund of Virginia which was within the 
bounds of the new state as stock in certain banks. This stock 
has been quite remunerative, one bank having paid ten per cent 
dividends for a number of years." July i, 1871, Virginia trans- 
ferred to West Virginia $552,079.29 and again on September 27, 
1886, $166,943.33 as the latter state's share of the Virginia Literary 
Fund.^i^ 

* See, above, Virginia Literary Fund, "Origin," pp. 420, 421. 



428 PERMANENT COMMON SCHOOL FUNDS 

The School Fund is managed by a board composed of the 
Governor, Superintendent of free schools, Auditor 

Management 

and Treasurer." ^^^ 
"Not a penny has been lost for a great many years." ^^^ Some 
time prior to 1875 about $6,000 was lost through 
the depreciation of bank stock. ^^'* 

The revenue of the School Fund is appor- 
tioned among the districts on the basis of school 



Loss 
Apportionment 

population.^^^ 

Objects 



The income can be used for teachers' wages 

In order to receive its share of the revenue, a district (i) must 
Conditions of maintain a school at least five months; (2) must 

Participation j^^y ^ j^^^l ^^^ Sufficient with the School Fund 

revenue to support a school.^^^ 

*37 School Law of W. Va., revised by State Supt. of Free Schools, 1903, p. 73, 
Sec. 61. 
^^ Ibid., p. 50, Sec. 40. 
63» Ibid., p. 52, Sec. 42, and p. 50, Sec. 40. 



CHAPTER LVII 

WISCONSIN 

SCHOOL FUND 

The titles "irreducible school fund," and "school trust fund" 
are sometimes applied to the permanent common school fund of 
Title. Wisconsin. The title provided by the constitu- 

Condition, 1904 tion, and, therefore, the correct title is the School 
Fund.^^'' "No printed report (concerning the School Fund) has 
been available since June 30, 1904." ^^^ At that time the fund 
consisted of $3,609,212.96 and 25,148.27 acres of unsold lands 
estimated to be vi^orth $99,000,^^^ making the total estimated value 
of the fund $3,708,212.96.* During the Civil War the state bor- 
rowed $1,563,700 from the School Fund; this sum has never been 
returned and is practically a permanent debt, secured by certifi- 
cates of indebtedness on which the state pays seven per cent 
interest. This interest is derived from state taxes whenever the 
income from other sources is insufficient.^^^ The remainder of the 
fund is invested chiefly in "loans to school districts for two pur- 
poses only: building school-houses or refunding district indebted- 
ness and loans to counties and cities for public buildings. The real 
estate of each of these is pledged to the state as security for the 
loan." ^^ No school lands are at present rented.^^ Wisconsin's 
total receipts from all sources for common schools in the year 
1903-4 amounted to $8,019,230.08.^'^^ Of this $210,419.51, ^ i. e., 
approximately two and sixty-two hundredths per cent (.02624-)* 
was derived from the income of the School Fund. It is, perhaps, 

* Computed. 

•s^o Constitution of Wis., 1848, Art. X, Sec. 2; Report U. S. Commissioner of 
Education, 1892-93, Vol. II, p. 1332. 
^1 Statement received from Wis. Dept. of Public Instruction, Sept. 12, 1906. 
642 Biennial Report, Wis. Dept. of Public Instruction, 1902-04, Vol. I. p, 130. 
6^ Ibid., p. 125. 

429 



430 PERMANENT COMMON SCHOOL FUNDS 

because so much of this nominal income is in reality derived from 
taxation that the reports for 1905 include it in state taxes.^^ 

Wisconsin provided for the establishment of her School Fund by 
her first constitution, which became effective upon her admission 

. . into the Union, 1848.^^" The original capital con- 

sisted of 958,649 acres ^^ of sixteenth section lands, 
and 500,000 acres granted under the Congressional act of 1841,'^'**' 
making the total amount of land thus originally devoted to the 
School Fund 1,458,649 acres. 

The Constitution provides the following sources for increasing 
the principal of the School Fund: '^■*'^ (i) proceeds of land granted 
Sources of by the United States; (2) money and proceeds 

Increase ^j property forfeited or escheated to the state; 

(3) military duty exemption moneys; (4) penal fines; (5) any grant 
of the state whose purpose is not specified; (6) five per cent of the 
proceeds of the sale of federal public lands lying within the state. 

The losses which the fund has suffered seem to be due chiefly 

to the following causes: defaulting of state officers; lands sold for 

less than real value; dishonest bookkeeping; 

Loss 

partially-paid-for lands stripped of timber and 
returned comparatively worthless to the state; investment in 
poor securities; failure to add to the principal of the fund 
revenues from the sources devoted to it by law. Through the 
mismanagement and defaulting of state officers the lands in 
Wisconsin were sold at nominal prices to speculators and the 
interests of the state largely sacrificed.^'*^" As early as 1858, ten 
years after admission as a state, the Superintendent of Public In- 
struction complains that the School Fund is being lost and wasted. 
In 1892 these complaints continue (cf. Report 1858, p. 23, and 
Report 1891-92, p. 141). Lyman C. Draper, Superintendent of 
Public Instruction, in his Report, 1859, pages 10-12, complains that 
exorbitant taxation leads many who have purchased school lands 
on mortgage to forfeit lands to state, and so throw them back upon 
the state, and deprive the state of interest. He cites a case in 

^^'^ Kiehle, History of Education in Minn., p. 18; III. and Minn. School Lands, 
Management of. 



WISCONSIN 431 

which it is said $68.48 was charged as interest on the non-payment 
of $148.65 for one year, and $85.00 for one day.^ "The variation 
between ledger accounts of Wisconsin and Washington, divergences 
in various official statements, absence of all original vouchers in 
one large account, and the disappearance of many others in other 
accounts whose files are ostensibly complete render any attempt 
at making a trustworthy statement precarious." ^'^^ 

"The original grants to our state for school purposes amounted according 
to earlier reports to 1,474,720 acres. The earlier state superintendents esti- 
mated that over $5,000,000 would be received from these sales. . . . Double 
that amount might have been easily received after the sale of all but 60,000 
acres. The state can show but about $2,000,000 in its school fund credited 
to this source." ^^b 

"It is notorious that state lands covered by valuable timber have been sold 
and a fraction of their purchase price paid, the timber removed and the land 
then allowed to lapse to the state." ^^ 

"The certificates of indebtedness are evidence of the disappearance of nearly 
one-half of the school fund. The law which directed the investment of the 
school fund in the purchase of state bonds provided for the cancellation of 
all bonds and substitution therefor of certificates of indebtedness. The certifi- 
cates are non-negotiable and non-transferable. No provision whatever is 
made for their payment. The discretionary authority of the commissioners, 
who are clothed with constitutional powers over its investment, is thereby 
destroyed by statutory enactment.^^o The rate of interest on these certificates 
is 7%; 849 the effect is the creation of a perpetual state debt requiring the levy 
and collection of an annual state tax to the amount of $157,570 to pay the in- 
terest thereon. The interest paid . . . thus far amounts to about $4,200,000, 
and the process seems just begun. Additional burdens of taxation are the 
only fruits of the school fund, the very result which it was intended to avoid." ^so 

" Nominal Amount of State School Fund (1892) $3,358,502.50 «48 

" Certificates of Indebtedness (1892) 1,563,700.00 6« 



Actual amount available for investment .... $1,794,802.50 " ^8 

644 Report Supt. of Public Instruction, Wis., 1859, p. 11. 

645 Report Supt. of Public Instruction, Wis., 1891-92, p. 161. 

646 Ibid., p. 143. 

647 Ibid., p. 142. 

648 Ibid., p. 152. 

649 Ibid., p. 153. 

650 Ibid., p. 154. 



432 PERMANENT COMMON SCHOOL FUNDS 

" This seems evident that a wise administration of all the provisions relat- 
ing to the School Fund should have resulted in a permanent endowment 
of from $15,000,000 to $20,000,000; that we have instead cash and money 
invested to the amount of $3,401,461.49 and a permanent state debt of 
$2,251,000; that the application of the available productive funds to the 
liquidation of the state debts will practically leave the state as though no 
provision had ever been made for the support of its schools ; that the neces- 
sity for the disappearance of this money is not apparent; that the laws and 
records have been witnesses to transactions of more than doubtful pro- 
priety ; and that the security for the debt is of questionable validity.®^ ^ 

"Nominal amount of total (1892): 

Common School Fund $3,358,502.50^8 

University Fund 228,629.57 ^^ 

Agricultural College Fund 290,054.00 *•* 

Normal School Fund 1,774,375.428*8 

Total nominal amount of school fund $5,651,469.49 

Total amount represented by certificates of indebtedness 2,251,000.00 

Actual amount of productive funds $3,400,461.00" 

Technically speaking, the money borrowed from the School 
Fund during the Civil War is not a loss, yet it must cer- 
tainly be considered a misappropriation, and it is difl&cult to dis- 
tinguish the difference between being taxed directly and being 
taxed to pay your own interest on an inherited trust fund.* The 
fund has suffered seriously from two sources; first, the wasting 
of the school lands, and, second, insufficient legislation respecting 
the sources of increase. Vast stretches of school lands were bought 
by lumber speculators for $2.50 per acre, who, it is said, were 
required to pay only forty cents on the acre. The timber was cut 
off and the lands then comparatively worthless reverted to the state. 
In 1904, $24,391.49 was derived from penal fines, which sum goes 
to increase the principal of the fund, but evidently the School Fund 
is not receiving all that it should from this source. It is difficult 
to understand why a county like Dane should contribute, in 1904, 
$2,431.10, while Milwaukee County contributed only $35.77. Dane 

* Many states buy state bonds with proceeds of school lands sales and pay in- 
terest out of taxes. See Minnesota. 
651 Ibid., p. 161. 



WISCONSIN 433 

County has a population of about 75,500 whereas Milwaukee 
County has a population of nearly 364,000. Dane is the capital 
city county and may be assumed to be reasonably intelligent and 
law-abiding and there is no reason for believing that in Milwaukee 
County there is a vastly greater respect for law than in Dane 
County. 
The School Fund is managed by a Board of Commissioners 
composed of the Secretary of State, Treasurer, 

Management \ 

and Attorney-General.^^'^ 
The revenue is apportioned among the counties, towns, villages, 
and cities on the basis of the total school popula- 
ppor onmen ^.^^ ^^ ^^^ Same (f our to twenty years) .^^^ 

The constitution provides that the revenue of the School Fund 
may be applied to the following objects: ^^° (i) support and main- 
tenance of common school in each school district: 

Objects 

(2) libraries; (3) apparatus: (4) the residue shall 
be appropriated to the support and maintenance of academies, 
normal schools and libraries and apparatus therefor. 

In order to receive its share of the School Fund revenue the school 
corporation must fulfil the following conditions: ^^^ (i) it must 
Conditions of ^^^^^e annually by local tax or by transfer from the 
Participation general fund to the School Fund of the school 

corporation, an amount equal to its quota of the School Fund 
revenue; (2) it must maintain a common school for six months 
taught by a qualified teacher unless excused for sufficient grounds 
by the Superintendent of Public Instruction; (3) it must submit 
the report required by law; (4) the report must contain an actual 
school census taken under the Board of Education or other super- 
visory body. 

652 Constitution of Wis., Art. X, Sec. 7. 

653 Revised Statutes, Wis., Chap. 28, Sec. 2. 

654 School Laws of the State of Wis., 1897, XVI, pp. 181, 182. 



CHAPTER LVIII 
WYOMING 

COMMON SCHOOL PERMANENT FUND 

The laws and constitution of Wyoming fail to provide any oflBcial 
title for the state's permanent common school fund. The title 
i>itie_ employed in the reports of the Superintendent of 

Condition, 1906 Public Instruction is the Common School Perma- 
nent Fund.^^^ In 1906 this fund consisted of $173,000 ^^^ (invested 
chiefly in school district and county bonds) and 3,458,010 acres ^^^ 
of unsold common school lands estimated to be worth approxi- 
mately $3,000,000.* Of these unsold lands 2,057,000 acres ^^® 
were leased, leaving 1,401.010 acres unleased. The principal is 
intact, none of it ever having been borrowed by the state; ^^^ 
$23,706.76 belonging to the fund was lying in the state treasury 
uninvested September 30, 1906, because of the lack of opportunity 
to purchase bonds.^^^ The principal of the fund can be invested 
in the following bonds only: United States, state, school district, 
and county .^^^ The annual income in 1906 derived from the prin- 
cipal amounted to $11,106.60^^^ and the rent of school lands to 
$100,009.83 ^^^ making the total income from the Common School 
Permanent Fund $111,116.43. The total income from the 
Common School Permanent Fund in 1905 was $180,889.11 1 of 
which $178,875.81 was derived from the rent of lands and $2,013.29 
from the invested principal. The total common school revenue 

* This is Mr. Fuller's estimate. The estimate given, Report U. S. Commissioner 
of Education, 1905, p. 419, is $5,329,000, for all lands leased and unleased. 

t Statement of Mr. Fuller, Report U. S. Commissioner of Education, 1905, 
gives it as $79,279. 

655 Report Supt. of Public Instruction, Wyo., 1899-1900, p. 13. 

656 Statement received from Robert P. Fuller, Wyoming Commissioner of Public 
Lands, Dec. 12, 1906. 

434 



WYOMING 435 

in 1905 derived from all sources excluding balances on hand and 
bond sales was $366,300/^ of which, therefore, approximately 
forty-nine per cent (493 + )* was income from the Common School 
Permanent Fund. 

Wyoming, upon her admission into the Union in 1890, received 
from the United States by act of Congress, for the use of common 
^ . . schools, the sixteenth and thirty-sixth sections in 

Origin ■' 

each township, amounting in all to 3,458,010 

acres.^^^ The first constitution adopted by Wyoming upon admis- 
sion into the Union declared the following "to be perpetual funds 
for school purposes of which the annual income only can be appro- 
priated, to wit:" ^^^ (i) the proceeds of the sales of sixteenth and 
thirty-sixth section lands; (2) the proceeds of all lands granted to 
Sources of the state not otherwise appropriated; (3) the pro- 

increase ceeds of land and property escheated or forfeited 

to the state; (4) the proceeds of income dividends; (5) the proceeds 
of intestate estates; (6) five per cent ^^^ of the proceeds of sales of 
United States lands lying within the state. 
The only loss reported occurred in 1893, through the failure of 
a bank. The Common School Permanent Fund's 

Loss 

share of the loss was $5,768.35.*^^'^ 
The fund is managed by "The State Board of School Land 
Commissioners" composed of the Governor, Secretary of State, 
State Treasurer, and Superintendent of Public 

Management ^ 

Instruction, who control the leasing and sales of 
the lands under the direction of the legislature.^^^ The direct 
management falls chiefly upon the Commissioner of Public Lands 
who is the Secretary of the State Board of Land Commissioners, 
his office having been provided for in 1905.^*"^ 



* Computed. 

657 Constitution of Wyo., Art. VII, Sec. 13; Report U. S. Commissioner of Educa- 
tion, 1892-93, Vol. II, p. 1408. 

658 Report Supt. of Public Instruction, Wyo., 1901-02, p. 59. 

659 Constitution, Wyo., Art. VII, Sec. 13; Rules of Wyo. State Land Board, 
1905, p. 11; Session Laws, 1903, Chap. 78. 

660 Wyo. Session Laws, 1905, Chap. 36. 



436 PERMANENT COMMON SCHOOL FUNDS 

The revenue is apportioned by the county superintendent as 
follows: ^^^ (i) $iqo to each school district in the 

Apportionment 

county; (2) the residue is apportioned on the basis 
of school population. 

The objects to which the school fund revenue shall be applied 

appear not to be named nor specified by law.* It is provided, 

however, that it shall be applied exclusively to 

the support of free schools.^^^ 

A district, in order to participate in the revenue of the Common 

Conditions of School Permanent Fund, must maintain a school 

Participation f^j. ^^ j^^g^ ^j^j.^^ months.^^^ 

* See Idaho, foot-note 122". 

661 Wyo. School Laws, 1904, p. 98, Sec. 6, p. 361. 

6«2 Constitution of Wyo., Art. VII, Sec. 7. 



APPENDIX A* 

Tables Relating to the History of Permanent Public Common School 
Funds, Revenues and Expenditures in Six Typical States: Connecticut, 
Florida, Indiana, Maine, Massachusetts, New York. 

Table XXVI. Growth of Principal and Income of Connecticut School 

Fund, 1799-1905 25 



Year 


Principal 


Income 


Year 


Principal 


InC0'rl1£ 


1799 


Not reported 


$ 60,403.78 


i860 


$2,050,460.49 


$131,825.00 


1800 


prior to 


23,651.10 


1865 


t 


132,018.78 


i3os 


1820 


45,157-39 


1866 


2,044,035.47 


130,658.00 


1815 




38,878.00 


1875 


t 


148,473.00 


1820 


$1,858,074.33 


58,439.36 


1876 


2,028,332.81 


135,219.00 


1825 


1,719.434-24 


72,418.30 


1885 


2,030,123.74 


120,855.20 


1835 


2,019,920.89 


83,799.00 


1895 


2,013,102.01 


130,832.25 


1845 


2,070,055.01 


117,730.20 


1905 


2,022,502.23 


109,579.27 


1855 


2,049,953-05 


130,054.60 









The School Fund is intact as is shown by the following "Abstract of the 
Schedule of the Securities Constituting the Principal of the Connecticut School 
Fund, September 30, 1905." 26 



Securities Constituting Principal of the Connecticut School Fund 
September 30, 1905 

Bonds, Notes and Mortgages 

In Connecticut $1,000,067.47 

In Ohio 677,772.00 

In Indiana 13,600.00 

In Massachusetts iS7-oo 

$1,691,596.47 

* These tables were included in that portion of the original manuscript which, 
as explained in the Preface, it has been necessary to omit. 
f Not reported. 
25 Report Conn. Commissioner of the School Fund, 1905, pp. 7, 12, 13. 

437 



438 PERMANENT COMMON SCHOOL FUNDS 

Securities Constituting Principal of the Connecticut School Fund 
September 30, 1905 — continued 

Brought forward $1,691,596.47 

Real Estate 
By foreclosure and deeds, cost 178,255.46 

Bank Stock 
In nine banks 115,212.61 

Cash 
In Treasury 37,437.69 

$2,022,502.23 

The entire income of the fund during the hundred and eight years it has 
drawn interest, has amounted to $10,639,765.02,25 making the average annual 
dividend $98,516.34. 



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440 PERMANENT COMMON SCHOOL FUNDS 

Table XXVIII. Connecticut School Support, 1825-95 

Presenting the Total Cost of Public Education, the Number of Persons of 
School Age, and a Comparison of the Amount Per Child derived from the 
Income of the School Fund with the Amount derived' from all other sources. 









Amt. Per Child 


Amt. Per 


Child in 




Total Cost 


No. Persons 


Enumerated, 


Actual Attendance 


Year 


Public 
Education * 


School 
Age f> 


Received from 


Received from 




All 


School 


All 


School 








Sources 


Fund 


Sources 


Fund 


1825 




84,976 




$0.85 3 






183s 




83,779 




1. 00 ff 






1845 




84,093 




1.40 a 






1855 


1 33i>82i 


100,294 


% 3-31 ^ 


1.25 d 






1865 


562,241 


114,825 


4.90 <* 


i.i5<« 






187s 


1,552,583 


134,976 


II.81 e 


1. 10 * 


$23.22 


$2.15 « 


1885 


1,852,221 


151,069 


10.31 e 


0.79 « 


19.72 


1. 51 " 


189s 


2,585,109 


174,443 


13-34 « 


0.74 « 


23.66 


1.31 « 



* Report Commissioner Conn. School Fund, 1900, p. 15. 
c Computed. 

^ Report Conn. Board of Education, 1868, p. 33. 
« Ibid., 1898, p. II. 
Ibid., 1884, p. 19. 

* Ibid., 1869, p. 14. 

* For sources cited see Table XXVII, p. 439. 



Table XXIX. Growth of Teachers' Wages in Connecticut, and Relation 
OF Same to Total Expenditures for Schools 



Year 


Total Amt. Spent for 
Teachers' Wages 


Per Cent Which 

Teachers' Wages Is of 

Total Expenditures 


Teachers' Average Wage 
Per Month 
Male 1 Female 


1S68 

1875 
1885 

1895 
1900 


$ 557,193" 
1,021,714 « 
1,130,863 a 
1,548,148 a 
1,896,915 6 


57.8 a 
60.1 <^ 

63.6 a 

58.5 « 

60.7 & 


$52.05 <i 
71.48 <i 
69.17 ^ 
85.87 '^ 
89.87 « 


$24.91 '^ 
36.67 <* 
37.21 <i 

41.48 <i 
43.61 e 



'^ Report Conn. Board of Education, iJ 
^ Ibid., 1902, p. 47. 
d Ibid., 1898, p. 53. 
« Ibid., 1902, p. 92. 



p. II. 



APPENDIX 



441 



Table XXX. Florida State School Fltnd — Growth of Principal and 
Income and Relation of Income to Total Public School Expenditure 











Per Cent Con- 


Year 


Principal 


Income State 


Total Public 19 


tributed by 


School Fund 


School Expenditure 


State School 










Fund 


1870 


$ 223,59515 


$38,14521 


$ 129,43124 


29 c 


187 s 


219,40015 


17,50023 




12.5+ c 


1876 






139,340 




1885 


490,78415 








1886 




34,31822 


309,890 


11+ c 


1894 




35,305 2" 


653,175 


5-4+ " 


189s 


647,10018 








1902 




30,813 26 


792,91924 


3.925 


1905 


1,085,367 *, 14 


33,632 " 


1,473,191.8014 


2.28 c 



^ Computed. 

* Not including the value of unsold school lands. 

14 Statement returned Feb. 24, 1907, by W. M. Holloway, Fla. State Supt. Public 
Instruction. 

15 Report Fla. State Supt. of Public Instruction, 1892-94, p. 67,. 
w Ibid., 1894-96, p. 53. 

19 Report Fla. State Supt. of Public Instruction, 1892-94, p. 63, gives data for 
1870-94. 

20 Ibid., p. 66. 

21 Ibid., 1870, p. 16. 

22 Ibid., 1885-86, p. 27. 

23 U. S. Commissioner of Education, Report, 1875, p. 65. 

24 Ibid., 1902, LXXXV. 

25 Ibid., LXXIV. 
28 Ibid., LXXXIII. 



442 



PERMANENT COMMON SCHOOL FUNDS 



Table XXXI. Indiana Common School Fund 
Origin and Composition 



Title of Fiend 


Date of Origin 


Amount Added to Com- 
mon 0- School Fund 


County Seminary Fund 
Saline Fund * 


1816 
1816 


$ 103,23814 
85,000 21 


Delinquent Tax Fund * 
Bank Tax Fund 


1832 
1834 


Nothing 
80,000 21 


Sinking Fund 

Surplus Revenue Fund f 


1834 
1837 


4,767,80521 
567,12626 



"• The amounts given in the different state reports do not always agree vi^ith 
themselves nor with those given by Boone. 

" Added to Common School Fund, 1853. 

* Purpose not stated, 1816, not devoted to schools until 1819. 

f Bourne, E. G., History of the Surplus Revenue of iSjy, pp, 60-64, 122. Ac- 
cording to Bourne, the $567,126 of United States Surplus Revenue distributed 
originally among the counties was lost, so it can scarcely be said to have actually 
added anything, though it serves as a resource as counties must pay interest on the 
amount credited to them. 

14 Boone, R. G., History of Education in Indiana, p. 186, and Report Indiana 
State Supt. of Public Instruction, 1878, p. 80. 

21 Report Indiana State Supt. of Public Instruction, 1871-73, pp. 15-16. 

26 Boone, R. G., History of Education in Indiana, p. 196. 



Table XXXII. Sources of Increase of Indiana Common School Fund 



A. Unproductive: 

1. Delinquent Tax Fund 

2. Michigan Road Sales 

3. Escheated Estates 

4. Taxes on Corporations 

5. Swamp Land Fund 



B. Productive: 

1. Fines 

2. Forfeits 

3. Estrays 



APPENDIX 



443 



Table XXXIII. Showing Increase of Principal of Indiana Common School 
Fund from Sources Named 



Year 



Fines and 


Amounts Added from 


Forfeitures 


Other Sources 


$32,904 


1 2,143 


46,339 


3.67 s 


49,860 


6,664 


59,969 


14,867 


43>444 


9,706 


41,433 


12,080 


49,353 


96,845 


9S>7S2 


6,474 



1868 56 
187556 
1885 55 
1895 57 

1902 57 

1903 57 

1905 57 

1906 57 



55 Boone, R. G., History of Education in Indiana, p. 189. 

56 Report State Supt. of Public Instruction, 1878, p. 80. 

57 Ibid., 1906, p. 811. 



Table XXXIV. Growth of Principal of Indiana Common School Fund, 

1854-1906 





Principal 




Year 


Congressional Township 


Common School 


Total * 




Fund 


Fund 




1853 






$ 2,278,58862 


1854 


$1,676,717" 


$ 882,591 


2,559,308 62 


1864 


2,098,715 61 


5,679,640 « 


7,778,355^ 


1874 


2,330,823 11 


6,468,368 c 


8,799,191 58 


1885 


2,404,936 59 


6,923,85459 


9,328,79158 


1895 


2,501,590^^ 


7,645,36959 


10,146,95958 


190S 


2,473,14359 


8,168,08259 


10,641,22658 


1906 


2,473.143 ^'^ 


8,270,25559 


io>743.399 ^^ 



<= Computed. 

* Total theoretically should always equal sums of other two; practically it does 
not, as in some cases unsold lands are included by the state reports in the principal. 
11 Boone, R. G., History of Education in Indiana, p. 180. 

58 Report Indiana State Supt. of Public Instruction, 1906, p. 810. 

59 Ibid., pp. 804, 805. 

61 Ibid., 1863-64, p. 19. 

62 Cotton, F. A., Education in Indiana, p. 177. 



444 PERMANENT COMMON SCHOOL FUNDS 

Table XXXV. Growth of Income of Indiana Common School Fund 





Revenue Common 


Revenue Congressional 


Tninl 




School Fund 


Township Fund 




Noc 


lata prior to 1864 






1865 63 


$ 97.672 


$154,632 


$252,304 e 


1875 63 


424,337 


167,231 


591.568 « , 


1885 64 


476,841 


202,389 


679,230 c 


189s 60 


452,932 


153.169 


609,101 c 


1905 60 


485,096 


153,271 


638,367 


1906 60 


479.147 


147.775 


626,922 "^ 



* Computed. 

60 Report Indiana State Supt. of Public Instruction, 1906, pp. 806, 807. 

63 Ibid., 1876, p. 67. 

64 Ibid., 1885-86, p. 166. 



Table XXXVI. Average Annual Increase of Principal « of Indiana 

School Funds 



Years 


Congressional Township Fund 


Common School Fund 


1854-1864 
1864-1875 
1875-1885 
1885-1895 
1895-1902 


$42,199 

21,100 

7.411 

9,665 

5,183 (decrease) <> 


$479,704 
71,748 
45.548 
72,151 
47,601 



<= Computed. 

o Data given in reports includes estimated value of unsold lands. Decrease 
is probably due to overestimate of value of unsold lands. 



APPENDIX 445 

Table XXXVII. Comparison of Indiana School Revenues * 







Common 


Congressional 






Year 


Total<i 


School 
Fund 


Township 
Fund 


Stale Tax 


Local Tax 


1866 


$ 1,998,537 


$111,425 


$150,044 


$ 910,585 


$ 666,673 


1868 


2,668,946 


299,654 


154,037 


864,548 


1,102,441 


1873 


3,835,991 


423,520 


98,988 


1,190,627 


2,048,066 


1885 


4,917,035 


476,841 


202,390 


1,416,884 


2,455,756 


1895 


6,977,892 


452,932 ^ 


153,169 


1,980,452 


3,977,755 


1900 


7,229,017 


460,516 * 


147,456 


1,595,344 


4,437,284 


1902 


8,055,861 


475,534* ' 


139,059 


1,623,170 


5,242,619 


1905 60 


10,564,799 


485,096 


153,271 


1,812,617 


3,752,702 


1906 00 


9,335,237 


479,147 


147,775 


1,851,960 


3,559,113 



"• Total revenue does not agree with total expenditures, since latter includes 
items not coming through regular channels. Cotton, F. A., Education in Indiana, 
p. 185, note 4. 

* Including amount paid by borrowers and by counties. 

* Data through 1885 computed from (Table) Boone, R. G., History of Education 
in Indiana, p. 335, compared as far as possible with reports. Data after 1885 
taken from state reports as given by Cotton, F. A., Education in Indiana, pp. 184, 
185. 

60 Data for years 1905 and 1906 are from Report Ind. State Supt. of Public 
Instruction, 1906, pp. 806-807. 



Table XXXVIII. Growth of Indiana's Endowed School System f 



1855 


1865 


1875 


1885 


1. Population 1,350,428 

2. School Census . . . 452,124 

3. Enrolment .... 206,994 

4. School Term in days . 61 

5. Taxables $300,000,000 

6. Expenditures .... 500,000 

7. Teachers, Number Em- 

ployed 4,000 

8. Salary, Average Per 

Month: 

Male $23.76 

Female 16.84 


1,680,637 

552,244 

413,374 

66 

$567,000,000 
1,338,540 

9,313 

$31.00 
20.50 


1,978,362 

667,736 

502,362 

130 

$898,000,000 
4,921,085 

^3,^33 

$42.40 
38.20 


2,192,404 

740,949 

504,520 

129 

$794,000,000 

5,218,999 

13,254 

$44.60 
36.80 



t Table XXXVIII is taken from Boone, R. G., History of Education in Indiana, 
P- 315- 



446 



PERMANENT COMMON SCHOOL FUNDS 



Table XXXIX. Growth of Principal and Income of Maine Permanent 
School Fund — Relation to Other Sources of School Revenue 





Permanent School Fund 


Total Expendi- 
tures for Public 
Schools 


Portion of Total Ex- 
penditures Derived 
from Income of Per- 
manent School Fund <' 


Year 


Principal 


Income 


1S38 


$ 2,813 24 








1842 


20,78224 




See foot-note ° 




1S46 


57,629 ^•i 




Table XXXVII 




1848 


104,648 24 








1851 




$6,25527 


$ 350,00043 


.052 


iSS5 


125,28124 


7,516 27 


467,217 44 


.052 


1S65 


181,231 3S 


10,120 39 


810,56045 


.036 


1S7S 


400,558^0 


22,193 « 


^,Z^h5°5^^ 


.036 


1885 


442,757 '^ 


26,56542 


1,002,56647 


.051 


189s 


442,757 43 


26,56542 


1,264,87048 


•057 


1905 


442,757*2 


26,565 42 


2,607,78342 


.0102 


1906 


445,625 42 









" Computed. 

24 Me. School Report, 1855, p. 15. 27 ibid., p. 16. 

38 Ibid., 1866, p. 46. 

38 Ibid., this is for 1S64, not given for 1865. 
40 Me. School Report, 1875, p. 8. 4i ibid., p. 9. 

42 Statements received from State Treasurer Oct. 28, 1904, and from Ed. Wiggin, 
Secretary of State Department of Education, Nov. 8, 1906. 

43 Estimate from data given Me. School Report, 1851, p. 18. 

44 Me. School Report, 1S55, p. 7, computed by subtracting expenditure for 
private schools from total expenditure. 

48 Me. School Report, 1865, p. 37, computed same as 44. 

48 Report U. S. Commissioner of Education, 1875, p. xxxii; Me. School Report, 
1875, p. 9, gives $1,339,704. 

47 Me. School Report, 1885, App., p. 61. 

48 Me. School Report, 1895, App., p. 188. 



Table XL. Maine Local School Tax Rate, 1821-1872 



I82I 


1853 


IS54 


1865 


1868 


1S72 


$0.40 11 


$0.5012 


$0.60 12 


$0.75 12 


$1.00 12 


$0.80 12 



"Act, Jan., 1821, Sec. i; Study of the History of Education in Maine, by Supt. 
of Public Schools, p. iS. 
12 Me. School Report, 1872, p. 28. 



APPENDIX 447 

Table XLI. Maine School Bank Tax 

(Only form of state aid antedating distribution of income of Permanent School 

Fund) 

Amt. Bank Tax 
Year Contributed 

to Schools 

1833 $18,38915 

1837 49>4i5^^ 

1863 79,83017 

1864 39,38518 

1867 4,475 1* 

1868 4,47320 

1869 Ceased 21 

15 Maine School Report, 1855, p. 14. 

16 Ibid., 1855, p. 14. 

17 Ibid., 1866, p. 43. 

18 Ibid., 1864, p. 56. 

19 Ibid., 1867, p. 44. 

20 Ibid., 1868, p. 72. 

21 Ibid., 1869, p. 156. 



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fe t- d r- tn 00 



APPENDIX 



449 



Table XLIII. Maine Teachers' Wages Per Month, Exclusive of Board 
Unless Stated Otherwise * 



Year 



Male 



Female "■ 



1851 $16.66 65 

1855 20.57 ^ 

1865 27.76 67 

1872 33-17*3 

1875 36.9664 

1885 32.07 68 

189s 3S-ii*» 

1902 36.05 70 



$5.9265 

7.60 68 
9.96 67 
14.00 63 
17.3664 
15.8468 
24.04 69 
27.2470 



* For foot-notes see those accompanying Table XLII. 



450 



PERMANENT COMMON SCHOOL FUNDS 



Table XLIV. Massachusetts 



Year 


Total Public 
School Ex- 
penditure of 
Massachu- 
setts a 


Limit Placed 

on Principal 

of Mass. School 

Fund by Law 


Principal of 
Massachusetts 
School Fund 


Total Income 
From Mass. 
School Fund 


Amount of In- 
come of Mass. 
School Fund 
pd. to Towns 
& Cities for 
Common 
Schools e 


School 
Age 


1835 




$1,000,000^8 


$ 514,906' 


$16,1766 


$ 16,176 




1837 






561,6767 


20,040 ' 


20,040 


4-16 


184s 


$ 801,0271,6 


1,500,000(1831) 4' 


789,389^ 


28,966 7 


28,966 


4-16 


1856 


2,346,309 2, 6 


2,000,000(1854) ■" 


1,627,467 s 


90,566 8 


46,808 13 


5-1 S 


186s 


l,940>S96^ 




2,000,000 9 


121,7868 


60,7241* 


5-1 S 


1875 


6,201,614 3, d 




2,065,238 10 


167,655" 


83,82715 


S-15 


1885 


7,020,430'' 




2,710,241 11 


134,13611 


67,97216 


s-is 


189s 


io,66i,3s65 


5,000,000(1894) 50 


3,870,54812 


172,72912 


79,410 1' 


5-15 


1902 


15,132,133^ 




4,570,54812 


220,731 12 


182,27018 


5-iS 


190S 


13,186,65252 




4,880,111 « 


219,379*' 




5-1 5 



Explanation of Foot-notes: — Rept. = Report of the Board of Education of Mass.; Sec. Rapt. = 
Report of the Secretary in the Annual Report of the Mass. Board of Ed. In the earlier reports, the 
Sec. Report and the Report of the Board, though bound together, are paged separately. Sec. 29th Rept. 
p. 53 =Page 53 of the Secretary's Report in the 29th Report of the Mass. Bd. of Ed.; 29th Rept. ^29th 
Annual Report of the Bd. of Ed. of Mass. Unless year is given Repts. are referred to by number. 

The following table will assist in determining the year of the Report: 

9th Report is for year 1845 39th Report is for year 1874-75 

20th " (1857) " " 1855-56 49th " " " " 1884-85 

25th " is for " 1860-61 S9th " " " " 1894-95 

29th " " " " 1864-65 66th " " " " 1901-02 

a Computed from data given in Annual Reports of Mass. Board of Ed. 

6 Expenditures for school buildings not called for prior to 1867. Some estimates have been made 
as follows: For 1845 see Sec. 9th Rept., p. 23; for 1855-56 see Sec. 20th Rept., p. 38. The total given 
in this table includes these estimates for these two years. The total given for 1856 includes, also, ex- 
penditures for Normal Schools, Teachers' Institutes, etc. The total given for 1865 does not include 
expenditures for school buildings. 

c Computed. 

<i Exclusive of expenditures for school books. 

« First payment direct to towns and cities was made in 1836. Owing to a change in the time for 
making school returns, no payment was made from November, 1838, to April, 1839, when $35,806, the 
income for i)4 years, was paid. After 1854, only one-half the income was paid directly to the towns 
and cities, the other half was devoted to general edusational expenses and to the principal of the 
School Fund. (See paragraph on "Objects.") 

/ Including board. 

g Not includins boaid. 



APPENDIX 



451 



School Fund — Summary 



Total Number 
Children of 
School Age 



Rate 
of Re- 
quired 
Local 

Tax 

per 
Child 



Total 
Local 
Tax Re- 
quired 

for 
Whole 
State c 



Total Local 
Tax Actu- 
ally Raised 



Excess 

Raised 

over 

Amount 

Required c 



Total 
Ex- 
pendi- 
ture 
per 
Child 



Amount 

per Child 

Received from 



Income 

of 
School 
Fundc 



Local 
Tax 



Teachers Average 
Monthly Wage 



Male Female 



l82,l9ll9(1839) 
194,C34 20 

222,853 ^* 
247,27s ^^ 
294,798 23 
343,810 24 
417,33s ^^ 
483,103 26 
513,15654 



$1.00 
I-2S 

i.So 
3-00 
3-00 
3 00 
3 00 
3-00 



$ 182,191 
243,730 

334,279 

741,825 

884,394 

1,031,430 

1,226,694 

1,449,309 



i 467,1242' 
726,56628 

1,802,167 
1,782,62430 

5,891,66631 

6,849,49032 

10,469,36733 

14,622,6543- 

12,594,42555 



$ 284,933 
482,836 

1,467,888 
1,040,799 
5,007,272 
5,818,060 
9,242,673 
13,173,345 



$0. 



$4.10 c 

10.5234 c 

7.406 
21.00 35 
20.42 38 
26.07 ^^ 
31.32 c 
35-34^^ 



.11 


$ 2.6238 


$25.4839 


.148 


3.6o38 


32.11«/ 


.21 


5-4838 


43-05«/ 


.20 


7.20 c 


54-77^3 


.28 


19.09 c 


88.3723 


.19 


19.17 c 


111. 234* 


.19 


25.6137 


128.55*5 


•39 


30.283' 


143-33^ 




24.5466 


149.05" 



$11.3839 

7-50*1 

l8.S242y 

21.8243 

35-35^3 

43-97** 
48.38*5 
53-37*5 
57-2251 



1 Sec. gth Rept., p. 23. 

2 Sec. 20th Rept., pp. 38, 76. 

3 39th Rept., pp. 121, 122. 

* 49th Rept., p. 50. 
5 66th Rept., p. 107. 

* 25th Rept., pp. 48, 49. 

7 Sec. 9th Rept., p. 22. 

8 Sec. 20th Rept., p. 70. 

9 Sec. 29th Rept., pp. 66, 67 
1639th Rept., pp. 135, 136. 

11 49th Rept., p. 67. 

12 66th Rept., p. 222. 

13 Sec. 20th Rept., p. 75. 
1* Sec. 29th Rept., p. 45. 

15 3gth Rept., p. 137. 

16 49th Rept., p. 50. 
1' 59th Rept., p. 201. 

18 66th Rept., p. xcii. 

19 Abstract Mass. Sch. Returns, p. 341. 

20 Sec. 9th Rept., p. 25. 

21 Sec. 20th Rept., p. 73. 

22 Sec. 29th Rept., p. 44. 

23 Sec. 39th Rept., pp. 120, 121. 

24 4gth Rept., p. 49. 

25 Sec. 60th Rept. p. 63. 

26 Computed from data 66th Rept., p. 89. 

27 Computed from data Sec. 20th Report, p. 75, 

as follows: Local Taxes for wages, fuel, 
etc., $387,124, local taxes for Sch. 
Buildings, $8o,coo; Total, $467,124. 

28 Computed; Building estimated at $150,000, 

$576,566 for wages, fuel, etc.. Sec. 9th 
Rept., p. 23. 



29 Computed like notes, 27 and 28; Sec. 20th 

Rept., p. 75. 
36 Too low; expenditure for building and repairs 

not reported; Sec. 29th Rept., p. 45. 

31 Computed like note 29, 39th Rept., p. 121. 

32 4gth Rept., p. Ixxvi. 

33 66th Rept., p. 106. 

34 Computed; $i2-|- is given. Sec. 20th Rept., 

p. 76. 

35 39th Rept., p. 122. 

36 49th Rept., p. 50. 

37 66th Rept., p. 108. 

38 Sec. 20th Rept., p. 38. 

39 Sec. 20th Rept., p. 41. 

40 Sec. gth Rept., p. 30. 

41 Ibid., p. 36. 

42 Sec. 20th Rept., p. 74. 

43 Sec. 29th Rept., p. 45. 

44 S3rd. Rept., p. 62. 

45 66th Rept., p. 92. 

46 Rept., Mass. Sch. Fund Commissioners, 1905. 

47 39th Rept., p. 7. 

48 Laws 1834, Chap. 169, Sec. i. 

49 Laws 1854, Chap. 300, Sec. 3. j 
56 Resolves 1894, Chap. 90. 

51 69th Rept., p. 76. 

52 Ibid., p. 77. 

53 Ibid., p. 79. 

54 Ibid., p. Ixxxviii. 

55 Ibid., p. xc. 

56 Ibid., p. cviii. 



452 



PERMANENT COMMON SCHOOL FUNDS 



Table XLV. Sources of Growth of Massachusetts School Fund, 

1835-1937 



Years 


Amount 


Source 


I, 2. 


1835-53 


$1,244,284 


Claims on United States for military services 
and proceeds of sales of state lands 


3- 


183s 




Forfeitures of School Fund income by towns 
failing to fulfil conditions necessary for par- 






1 


ticipation 


4- 


1854 


255,800 (Est'd) 


Railroad shares in Western Railroad corpo- 
ration 


S- 


1854 




Balances of that half of income of School 
Fund, used for general educational expenses 


6. 


1859-64 


456,930 


Back Bay lands 


7- 


1882 


624,000 


Exchange of stock at a premium 


8. 


1891 


12,043 


Collected war claims 


9- 


1891 


696,107 


U. S. direct tax 


10. 


1894-1905 


100,000 


Annual appropriation 


II. 


1890 




"Moneys received into state treasury disposi- 
tion of which is not otherwise provided for" 


12. 


1901-37 


25,000 


Excess income of the Fitchburg Railroad 




(Added 


to annual income) 


securities loan sinking fund 



At present (1905) three sources from which the principal of the Massa- 
chusetts School Fund may be increased are provided by law, as follows: 
(i) Portions of the School Fund income forfeited by towns for failure to fulfil 
conditions of participation; 28 (2) moneys received into the state treasury 
disposition of which is not otherwise provided for; ^^ (3) annual appropriation 
of $100,000 to be continued until the principal of the School Fund amounts 
to $5,000,000; 30 (4) $25,000 to be added annually to the income of the School 
Fund until 1937.25 

25 For full account see 64th Report, 1899-1900, pp. 19, 264. 

28 Public Statutes of Mass. relating to Public Instruction, Including Laws in 
Force, 1892. 

29 Acts, 1890, Chap. 335, Sec. i. 

30 Resolves, 1894, Chap. 90. 



APPENDIX 



453 



Table XLVI. Growth of Principal and Income of New York Common 
School Fund, 1806-1905 



Year 


Principal "■ 


Annual In- 
crease (+) or 
Decrease ( — ) 
of Capital 


Annual In- 
come or In- 
terest 


Annual Appro- 
priation from 
State Treasury 


Amount 
Received 
by Dis- 
tricts 


1796 




(See 


foot-note *) 


$49,250.00 


No distribution 
made until 
(1815) the reve- 
nue amt'd to 
$50,000 




1797 








50,000.00 






1800 








49,622.50 






1801 








377.50 






1806 


$ 58,757-24 


+1 


124,405.72 


Not stated 






1807 


183,162.96 


+ 


124,001.60 


11 (( 






1808 


307,164.56 


+ 


83,472.59 


(( (( 






1809 


390,637.15 


+ 


37,540.76 


24,115.46 






1810 


428,177.91 


+ 


55,148.38 


26,480.77 






1811 


483,326.29 


+ 


75,138.40 


36,427.64 






1812 


558,464.69 


+ 


78,293.38 


45,216.9s 






1813 


636,758.07 


+ 


185,306.07 


47,612.16 






1814 


822,064.94 


+ 


39,392.95 


57,248.39 


$ 48,376 


$55,720.98 


1815 


861,457.89 


+ 


72,557-24 


57,539-88 


46,398 


64,834.88 


1816 


934,015.13 


+ 


48,227.13 


64,053.01 


54,799 


73,235-42 


1817 


982,242.26 


— 


10,880.95 


69,555-29 


59,933 


93,010.54 


1818 


971,361.31 


+ 


132,587.78 


68,770.00 


59-968 


117,151.07 


1819 


1,103,940.09 


+ 


125,126.91 


70,556.04 


59,930 


146,418.08 


1820 


1,229,076.00 


— 


15,550.00 


78,944.56 


79,957 


157,195.04 


1821 


1,215,526.00 


— 


62,895.43 


77,144.56 


80,104 


173,420.56 


1822 


1,152,630.57 


+ 


3,196.83 


77,417.86 


80,000 


182,820.25 


1823 


1,155,827.40 


+ 


17,085.88 


72,515.09 


80,000 


182,741.61 


1824 


1,172,913-23 


+ 


115,396.19 


75,315-05 


80,000 


182,790.09 


1825 


1,288,309.47 


+ 


31,576.99 


82,815.41 


80,000 


185,720.46 


1826 


1,319,886.46 


+ 


33,591.18 


86,429.93 


80,000 


222,995.77 


1827 


i>3S3,477-64 


+ 


257,619.16 


81,381.90 


100,000 


232,343-21 



« Data for years 1801-50 taken from Report N. Y. State Supt. of Pubh'c In- 
struction, 1851, p. 38; ibid., 1895, p. 28, gives principal for years 1805-95; data 
for 1905 taken from Controller's Reports, 1905-06. 

* The superintendents in reporting data contained in this column did not follow 
a uniform principle: in the earlier reports, 1806-37, ^^^ increase or decrease is the 
increase or decrease during the year, opposite which it stands. In the later (1840- 
45) reports it is the increase or decrease over the previous year. Increase stated 
for 1838 and 1839 appears to be incorrect. 



454 PERMANENT COMMON SCHOOL FUNDS 

Table XLVI — continued 



Year 


Principal °- 


Atiiiual In- 
crease (+) or 
Decrease ( — ) 
of Capital 


Annual In- 
come or In- 
terest 


Annual Appro- 
priation from 
State Treasury 


Amount 
Received 
by Dis- 
tricts 


1828 


$1,611,096.80 


+ 


$73,532.00 


% 89,034.96 


$100,000 


$214,840.14 


1829 


1,684,628.80 


+ 


35,662.42 


94,626.25 


100,000 


238,611.36 


1830 


1,661,081.24 


— 


23,547-56 


100,678.60 


100,000 


244,998.85 


183 1 


1,696,743.66 


+ 


7,415-74 


80,013.86 


100,000 


305,582.74 


1832 


1,704,159-40 


+ 


31,015.88 


93,755-31 


100,080 


307,733.08 


1833 


1,735,175-28 


+ 


18,871.56 


109,117.77 


100,080 


316,153.98 


1834 


1,475,046.84 


+ 


36,498.46 


104,390.78 


100,080 


312,181.20 


1835 


1,791,321.77 


+ 


83,869.94 


131,006.40 


100,000 


313,376.90 


1836 


1,875,191.71 


+ 


42,302.46 


118,486.67 


100,000 


335,895.10 


1837 


1,917,491-17 


+ 


2,153-51 


94,349-93 


110,000 


335,882.92 


1838 


1,919,644.68 


+ 


10,059.83 


102,991.09 


113,793 


374,411.61 


1839 


1,932,421.99 


+ 


2,714.48 


117,472.27 


275,000 s 


633,685-94 


1840 


2,033,807.95 


+ 


101,385.96 


103,400.65 


* 275,000 


658,951.70 


1841 


2,036,625.68 


+ 


2,817.73 


96,073-85 


* 285,080 


676,086.07 


1842 


1,968,290.72 


— 


68,334-96 


90,092.46 


* 275,080 


660,727.41 


1843 


1,975,093-15 


+ 


6,802.43 


107,370.62 


* 265,080 


639,606.60 


1844 


1,992,916.35 


+ 


17,823.20 


133,826.51 


* 275,080 


725,066.19 


1845 


2,090,632.41 


+ 


97,716.41 


113,458.87 


* 275,080 


772,578.02 


1850 


2,290,673.23 


+ 


47,109.87 


137,524.07 


* 285,000 




1855 


2,457,520.86 * 


+ 


32,308.89 <' 


143,127.73 ^ 


* 310,000 ^ 




i860 


2,607,036.68 * 


+ 


20,785.52 




310,000 * 




1865 


2,765,760.77 ^ 






186,462.20 <^ 


310,000 * 




1875 


3,080,107.68 






179,264.66 « 


335,000 e 




1885 


3,880,157.39 1 






189,621.22 


245,000 * 




1895 


4,423,140.77 






181,579.27 


245,000 * 




1905 


4,673,140.77 






169,889.06 







" Data for years 1801-50 taken from Report N. Y. State Supt. of Public In- 
struction 1851, p. 38; ibid., 1895, p. 28, gives principal for years 1805-95; data 
for 1905 taken from Controller's Reports, 1905-06. 

* Report N. Y. State Supt. of Public Instruction, 1869, p. 101. 
"Ibid., 1856, p. 109. '^Ibid., 1S66, p. 14. 
« Ibid., 1876, p. 26. / Ibid., 1886, p. 101. 

$110,000 from revenue of Common School Fund; $165,000 from revenue of 
U. S. Deposit Fund. 

* $145,000 from revenue of Common School Fund; $165,000 from revenue of 
U. S. Deposit Fund. 

* $170,000 from revenue of Common School Fund; $75,000 from revenue of 
U. S. Deposit Fund. 

* Including, after 1838, $165,000 from Revenue of U. S. Deposit Fund. 







g 




o 




00 


VO 


to 








CO 








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BIBLIOGRAPHY 

SOURCES 

Constitutions of the various states of the Union. 

Enabling Acts of various states as cited. 

General Public Acts of Congress Respecting the Sale and Disposition of Public 
Lands with Instructions Issued from Time to Time by the Secretary of the Treasury 
and Commissioner of the General Land Office, and Official Opinions of the 
Attorney-General on Questions Arising under the Land Laws 2 vols. (Washing- 
ton, 1838, prepared and printed by order of the Senate). 

Journals of Congress. 

Organic Acts as cited. 

Reports of the United States Commissioner of Education. 

Reports of the Commissioner of the General Land Office. 

Reports of the State Auditors. 

Reports of the State Controllers. 

Reports of the State Land Commissioners, or of the Land Office. 

Reports of State Land Registers. 

Reports of State Surveyors. 

Reports of the State Superintendents of Public Instruction or Reports of State 
Boards of Education. 

Reports of State Treasurers. 

Revised Statutes and Acts. 

School Laws. 

Session Laws. 

United States Statutes at Large. 

SECONDARY AUTHORITIES— GENERAL 

Adams, Francis, The Free School System of the United States (Chapman-Hall, 

London, 1875). 
Adams, Herbert B., Maryland's Influence upon Land Cessions to the United 

States (Johns Hopkins University Studies, 3d Series, No. i, Baltimore, 1885). 
Andrews, Israel W., History of the Ordinance of 1787 (Proceedings of the Na- 
tional Educational Association, 1887, pp. 120-128). 
Blackmar, Frank W., History of State and Federal Aid to Higher Education in 

the United States (Washington; United States Bureau of Education, Circular 

of Information, No. i, 1890). 
Blair, Hon. W. H., National Aid to Education. (Proceedings of the Department 

of Superintendence, 1889, pp. 297-300; Washington; United States Bureau 

of Education, Circular of Information, No. 2, 1889). 

4S7 



458 PERMANENT COMMON SCHOOL FUNDS 

Boone, Richard Gause, Education in the United States; Its History from the 
Earliest Settlements (D. Appleton Co., New York, 1903). 

Bourne, Edward G., The History of the Surplus Revenue of 1837 (G. P. Putnam's 
Sons, New York and London, 18S5). 

Brown, Elmer Ellsworth, The Making of Our Middle Schools (New York; 
Longman's, Green & Co., 1903). 

Bush, Geo. Gary, The First Common Schools of New England (Washington; 
Report of United States Commissioner of Education, 1896-97, Vol. II, 
Chap. XXIV, pp. 1165-86.) 

Clews, E. W., Educational Legislation and Administration of the Colonial Govern- 
ments (New York, 1899). 

CuBBERLEY, Elwood P., School Funds and Their Apportionment (New York, 

1905)- 
Dexter, Edwin Grant, History of Education in the United States (New York; 

The Macmillan Co., 1904). 
Draper, Andrew S., The General Government and Popular Education (Proceed- 
ings National Educational Association, 1896, pp. 201-208). 
Eaton, Hon. John, National Aid to Education (Washington; United States Bureau 

of Education, Circular of Information, No. 2, 1879). 
Elliott, Edward C, State School Systems: Legislation and Judicial Decisions 

Relating to Public Education, October i, 1904, to October i, 1906 (Washington; 

United States Bureau of Education, Bulletin No. 3, 1906). 
Fellow, Henry C, A Study in School Supervision and Maintenance (Crane & 

Co., Topeka, Kansas, 1896). 
Gasquet, Henry VIII and English Monasteries, 2 vols. (London, 1888). 
Germann, George B., National Legislation Concerning Education (New York, 

1899). 
Hinsdale, B. A., (i) Educational Influence and Results of the Ordinance of 1787 

(Proceedings of the National Educational Association, 1887, pp. 135-140). 

(2) History of Popular Education on the Western Reserve (Ohio Archcclogical and 

Historical Society Publications, Vol. VI, 1898, pp. 35-58). 

(3) Documents Illustrative of American Educational History (Report United States 
Commissioner of Education, 1892-93, Part III, Chap. I, pp. 1 225-1414). 

Knight, Geo. W., History and Management of Land Grants for Education in the 
Northwest Territory (G. P. Putnam's Sons, New York, 1885). 

Lamoreux, S. W., State Grants of Public Lands — Tables (Department of the 
Interior, General Land Office, Washington, D. C, 1896). 

Leach, Arthur F., English Schools at the Reformation (Archibald Constable & 
Co., Westminster, 1896). 

Mansfield, E. D., Educational Land Policy of the United States (Barnard Am. 
Jo. Ed., Vol. 28, pp. 929-938). 

Mayo, A. D., (i) Public Schools in the United States During the Colonial and Rev- 
olutionary Periods (Report United States Commissioner of Education, 1893-94, 
Vol. I, Chap. XVI, pp. 639-738). 

(2) The American Common School in the Southern States During the First Half 
Century of the Republic, 1790-1840 (Report of United States Commissioner 
of Education, 1895-96, Vol. I, Chap. VII, pp. 267-338). 



BIBLIOGRAPHY 459 

(3) The American Common School in New York, New Jersey and Pennsylvania 
During the First Half Century of the Republic (Ibid., Vol. I, Chap. VI, pp. 
219-266). 

(4) The American Common School in Nezu England from 1790 to 1840 (Report of 
United States Commissioner of Education, 1894-95, Vol. II, Chap. XXXIX, 
pp. 1551-1615). 

(5) Education in the Northwest During the First Half Century of the Republic, 

1790-1840 (Ibid., Chap. XXXVIII, pp. 1513-50). 

(6) Original Establishment of State School Funds (Ibid., Chap. XXXVII, pp. 

1505-11)- 

(7) Organization and Reconstruction of State Systems of Common School Education 
in the North Atlantic States from 1830-1865 (Report of United States Com- 
missioner of Education, 1897-98, Vol. I, Chap. XI, pp. 355-486). 

(8) The Development of the Common Schools in the Western States from 183 0-1865 

(Report of United States Commissioner of Education, 1898-99, Vol. I, Chap. 

VIII, pp. 3 57-450) ■ 

(9) The Organization and Development of the American Common School in the 
Atlantic and Central States of the South, 1830-1860 (Report of United States 
Commissioner of Education, 1899-1900, Vol. I, Chap. VIII, pp. 427- 
562), 

(10) The Common School in the Southern States beyond the Mississippi River from 
1830-1860 (Report of United States Commissioner of Education, 1900-01, 
Vol. I, Chap. X, pp. 357-402). 

(11) Common School Education in the South from Beginning of Civil War to 1870- 
1876 (Ibid., Chap. XI, pp. 403-490). 

(i 2) The Final Establishment of American Common School System in West Virginia, 
Maryland, Virginia and Delaware, 1863-1900 (Report of United States Com- 
missioner of Education, 1903, Vol. I, Chap. IX, pp. 391-462). 

(13) The Final Establishment of American Commo?t School System in North Caro- 
lina, South Carolina and Georgia, 1863-1900 (Report of United States Com- 
missioner of Education, 1904, Vol. I, Chap. XVI, pp. 999-1090). 

Report of a Special Commission on the Permanent Common School Fund of 
Vermont to Vermont Legislature (Montpelier, Vermont, 1906). 

SCHAEFER, Joseph, The Origin of a System of Land Grants for Education (Bulletin 
No. 63, University of Wisconsin, History Series, Vol. I, No. i, Madison, Wis., 
1902). 

Sheldon, W. F., The Educational Influence and Results of the Ordinance of lySj 
(Proceedings National Educational Association, 1887, pp. 118-119). 

Warren, Charles, Illiteracy in the United States, with Appendix on National 
Aid to Education (Washington, United States Bureau of Education, Circular 
of Information, No. 3, 1884). 

Weeks, Stephen B., The Beginnings of the Common School System in the South, 
or Calvin Henderson and the Organization of the Common Schools of North 
Carolina (Report of United States Commissioner of Education, 1896-97, 
Vol. II, Chap. XXIX, pp. 1379-1474). 

Winterbotham, W., American Schools and Education (Barnard's American 
Journal of Education, Vol. XXIV, pp. 137-157). 



46o PERMANENT COMMON SCHOOL FUNDS 

SECONDARY AUTHORITIES— LOCAL (Arranged by States) 

Alabama * 

Clark, W. G., History of Education in Alabama, 1702-1889 (Washington; United 
States Bureau of Education, Circular of Information, No. 3, 1889). 

Perry, W. F., The Genesis of Public Education in Alabama (Alabama Historical 
Society Translations, Vol. II, pp. 14-27). 

Alaska 

Jackson, Sheldon, (i) Neglect of Education in Alaska (Washington; United 
States Bureau of Education, Circular of Information, No. 2, 1882, pp. 61-75). 

(2) Education in Alaska (Washington; United States Bureau of Education, Circular 
of Information No. 3, 1887, pp. igi-200). 

Arkansas * 

Shinn, J. H., History of Education in Arkansas (Washington; United States 
Bureau of Education, Circular of Information, No. i, 1900). 

California 

Kellog, Martin, Educational Progress in California (In California University 
Addresses delivered before the California Teachers Association at Riverside, 
1892). 

Report of Superintendent of Public Instruction, 1864-65, pp. 231-239, 300-339. 

Sv\^EET, John, History of the Public School System of California (San Francisco, 
1876). 

Colorado 

Hale, H. M., 1833, Grove, Aaron, 1839, and Shattuck, J. C, 1835, Anon., 

Education in Colorado, 1861-85 (Denver, 1885). 
Historical Sketch of Colorado Public Schools (Report Supt. of Public Instruction, 

1901-02, pp. 13-20 and 585-586). 
The School Lands of Colorado (Ibid., pp. 614-624). 

Connecticut * 

Hinsdale, B. A., (i) Connecticut Legislation 1642-1799 (Washington; Report of 
United States Commissioner of Education, 1892-93, Part III, Chap. I, pp. 
1240-56). 

(2) Plymouth Legislation 1658-1677 (Ibid., pp. 1238-39). 

(3) Common School Fund of Connecticut (Ibid., pp. 1256-61). 

Steiner, B. C, History of Education in Connecticut (Washington; United States 
Bureau of Education, Circular of Information No. 2, 1893). 

* Consult also Mayo, above. 



BIBLIOGRAPHY 461 

The following Reports of the Connecticut Board of Education are especially 
valuable for historical and statistical material: 1853, 1864-65, 1868, 1876, 
1888, 1S90. 

Delaware * 

Groves, History of Free Schools of Delaware (Report of Delaware Superintendent 

of Free Schools, 1880, pp. 43-54)- 
Powell, Lyman P., History of Education in Delaware (Washington; United States 

Bureau of Education, Circular of Information, No. 3, Vol. I, 1893). 

District of Columbia * 

Wilson, J. Ormond, 1805, Eighty Years of Public Schools of Washington, 1805- 
1885 (Report United States Commissioner of Education, 1894-95, Vol. II, 
Chap XLI, pp. 1673-98). 

Florida * 

Bush, George Gary, History of Education in Florida (Washington; United States 
Bureau of Education, Circular of Information, No. 7, 1888). 

Sheats, W. N., History of the Origin and Growth of Public Schools in Florida 
(Biennial Report State Supt. Public Instruction, 1893-94, pp. 5-60). 

Georgia * 

Johnston, Richard Malcolm, Early Educational Life in Middle Georgia (Wash- 
ington; Report United States Commissioner of Education, 1894-95, Vol. II, 
Chap. XLII, pp. 1699-1734; 1895-96, Vol. I, Chap. XVI, pp. 839-886). 

Jones, Charles Edgeworth, Education in Georgia (Washington; United States 
Bureau of Education, Circular of Information, No. 4, 1888). 

Idaho 

History of Common Schools (Report of State Supt. of Public Instruction, 1899- 
1900, p. 74, gives statistics for years 1869-1900). 

Illinois * 

Ellsworth, H. L., Illinois in 1837 (Gregg and Elliott, Philadelphia, 1837). 
PiLLSBURY, W. L., Permanent School Funds of Illinois (Illinois School Report 

1881-82, pp. cxx-cxliii.) 
WiLLARD, Samuel, Brief History of Early Education in Illinois (Illinois School 

Report 1883-84, pp. xcviii-cxx). 

Indiana * 
Boone, Richard Gause, History of Education in Indiana (New York, 1892). 
* Consult also Mayo, above. 



462 PERMANENT COMMON SCHOOL FUNDS 

Cotton, F. A., Education in Indiana (An official monograph prepared for the 
Louisiana Purchase Exposition at St. Louis, 1904; Indianapolis, 1904). 

Rawles, William A., Centralizing Tendencies in the Administration of Indiana 
(Studies in History, Economics, and Public Law edited by the faculty of 
Political Science of Columbia University, Vol. XVII, No. i, Macmillan Co. 
Agents). 

Skinner, Herbert M., Hobbs, Barnabas C, and Humphreys, Mary C, Histori- 
cal Review of Education in Indiana (Report Indiana Supt. of Public Instruc- 
tion, 1885-86, Part II, pp. 1-47)- 

Smart, James Henry, Indiana Schools and the Men Who Have Worked in Them 
(Cincinnati, 1876). 

WooDBURN, J. A., Higher Education in Indiana (Washington; United States 
Bureau of Education, Circular of Information, No. i, 1891). 

A History of the School System of Indiana (School Law of Indiana, 1901, pp. 27-38). 

Iowa 

Bowman, Harold M., The Administration of Iowa, A Study in Centralization 

(New York, 1903). 
Parker, Leonard F., Higher Education in Iowa (Washington; United States 

Bureau of Education, Circular of Information, No. 6, 1893). 
Reports of Superintendent of Public Instruction as follows: 1868, pp. 16-19; 

1872-73, pp. 44-48; 1902-03, pp. xii, xiii, xxvi. 

Kansas 

Columbian History of Education in Kansas (Compiled by Kansas Educators, 

Topeka, Kansas, 1903). 
Blackmar, Frank W., Eligher Education in Kansas (Washington; United States 

Bureau of Education, Circular of Information, No. 2, 1900). 
History of the State School System of Kansas, 1861-76 (Report Supt. of Public 

Instruction, 1878, pp. 37-42). 

Kentucky * 

Lewis, A. F., History of Higher Education in Kentucky (Washington; United 
States Bureau of Education, Circular of Information, No. 3, 1899). 

History of Permanent School Fund (Report of Supt. of Public Instruction, 1880-81, 
pp. 218-222; 1891-93, pp. 671-678). 

Louisiana * 

Fay, Edwin W., History of Education in Louisiana (Washington; United States 
Bureau of Education, Circular of Information, No. i, 1898), 

* Consult also Mayo, above. 



BIBLIOGRAPHY 463 

Maine 

Champlin, J. T., Educational Institutions in Maine While a District of Massa- 
chusetts (Maine Historical Society Collections, 1881, Series I, Vol. VIII, 
pp. 155-180). 

Hall, Edward W., History of Education in Maine (Washington; United States 
Bureau of Education, Circular of Information, No. 3, 1903). 

Hyde, Rev. W. D., Education in Maine (in W. T. Davis, New England States, 
Vol. Ill, pp. 1154-67). 

Stetson, W. W., Study of the Rural Schools of Maine by the State Superintendent 
of Common Schools (Augusta, Me., 1896). 

State Superintendent of Public Schools, A Study of the History of Education in 
Maine and the Evolution of Our Present School System (Augusta). 

Education in Maine, 1642, Including a Copy of Maine's First Educational Law 
(Maine School Report, 1870, pp. 181-192). 

Early Schools in Maine (Maine School Report, 1876, pp. 1-56). 

Maryland * 

Steiner, B. C, History of Higher Education in Maryland (Washington; United 
States Bureau of Education, Circular of Information, No. 2, 1894). 

Massachusetts 

BouTWELL, George S., Origin and History of Massachusetts School Fund (Annual 
Report of Board of Education of Massachusetts, 1859, pp. 38-56). 

Bush, George Gary, History of Higher Education in Massachusetts (Washing- 
ton; United States Bureau of Education, Circular of Information, No. 6, 1891). 

Carter, J. G., Schools of Massachusetts in 1824 (Boston). 

Emerson, G. B., Education in Massachusetts, Early Legislation and History 
(Boston, 1869). 

Dickinson, J. W., Massachusetts Public School System (Boston, 1893). 

Martin, G. H., The Evolution of the Massachusetts Public School System (New- 
York, 1894). 

Wightman, Jos. M., Annals of Boston Primary School Committee from Its Estab- 
lishment, 1818, to Its Dissolution, 1855 (George C. Rand & Avery, Boston, 
i860). 

The following reports of Massachusetts Board of Education contain valuable 
historical material: 

Twentieth Report, 1856, pp. 35 ff., A Retrospect for Twenty Years, 1837-1857. 

Fiftieth Report, 1885-86, pp. 88 ff., A History of School Legislation, 1837-1886. 

Michigan 

Gregory, J. M., School Funds and School Laws of Michigan (Lansing, 1859). 
HOYT, C. O., and Ford, R. C, John D. Pearce, Founder of Michigan School 
System, and Study of Education in the Northwest (Ypsilanti, 1905). 

* Consult also Mayo, above. 



464 PERMANENT COMMON SCHOOL FUNDS 

McLaughlin, Andrew C, History of Higher Education in Michigan (Washing- 
ton; United States Bureau of Education, Circular of Information, No. 4, 1891). 

Putnam, Daniel, (i) Development of Primary and Secondary Public Institutions 
in Michigan (Ann Arbor, 1904). 

(2) History of the Origin of Educational Funds of Michigan (Report of Supt. of 
Public Instruction, 1899, pp. 19-24). 

Shearman, F. W., System of Public Instruction and Primary School Law of Michi- 
gan (Lansing, 1852). 

Smith, W. L., Historical Sketches of Education in Michigan (Lansing, 1881). 

Primary School Fund of Michigan, Its Origin arid History (Michigan School Report, 
1870, pp. 153, 159). 

Minnesota 

Greer, John N., History of Educatiott in Minnesota (Washington; United States 
Bureau of Education, Circular of Information, No. 2, 1902). 

KiEHLE, David L., Education in Minnesota (H. W. Wilson Co., Minneapolis, 
1903). 

Report of Supt. of Public Instruction, 1878, pp. 6-45, contains valuable brief 
historical account. 

Mississippi * 

Mayes, Edward, History of Education in Mississippi (Washington; United States 
Bureau of Education, Circular of Information, No. 2, 1S99). 

Report State Supt. of Public Education, 1871, pp. 22 £f., gives an account of the 
Origin and History of School Funds. The same Report for the years 1895-96, 
pp. 31 ff., gives a statement concerning school lands. 

Missouri 

Snow, Marshall S., Higher Education in Missouri (Washington; United States 
Bureau of Education, Circular of Information, No, 2, 189S). 

Origin of Township Funds (Report State Superintendent of Public Schools, 
1869, p. 7). 

State and Seminary Funds, Origin and Growth (Ibid., 1901, pp. 33-37). 

Nebraska 

Caldwell, Howard W., Education in Nebraska (Washington; United States 
Bureau of Education, Circular of Information, No. 3, 1902), 

New Hampshire * 

Bush, George Gary, History of Education in New Hampshire (Washington; 

United States Bureau of Education, Circular of Information, No. 3, 1898). 
Common Schools of New Hampshire (N. H. School Report, 1876, pp. 177-301). 

* Consult also Mayo, above. 



BIBLIOGRAPHY ' 465 

New Jersey * 

Murray, David, History of Education in New Jersey (Washington; United States 
Bureau of Education, Circular of Information, No. i, 1889). 

New York 

Draper, A. S., Origin and Development of the New York Common School System 

(Albany, i8go). 
Fitch, C. E., The Public School (Albany, 1904). 
Hough, F. B., Historical and Statistical Record of the University of the State of 

New York (printed by the authority of the legislature, Albany, 1885). 
Millar, John, School System of the State of New York (Toronto, 1898). 
Pratt, D. J., Annals of Public Education in the State of New York, 1626-1746 

(Albanj, 1872). 
Randall, S. S., History of the Common School System of the State of New York 

(New York, 187 1). 
SCHEPMOES, A. E., Rise and Progress of the School System of the State of New York 

(Syracuse, 1891). 
Sherwood, Sidney, The University of the State of New York (Washington; United 

States Bureau of Education, Circular of Information, No. 3, 1900). 

North Carolina * 

Raper, Charles Lee, The Church and Private Schools of North Carolina (Joseph 

J. Stone, Greensboro, N. C, 1898). 
Smith, Charles Lee, History of Education in North Carolina (Washington; 

Bureau of Education, Circular of Information, No. 2, 1888). 
Wiley, C. H., History of Education in North Carolina (Report Supt. Common 

Schools, 1896-98, pp. 428-573). 

North Dakota 

History of Common Schools from Earliest Times (North Dakota Territorial School 
Report, 1884, pp. 23-40). 

Ohio* 

Burns, J. J., Educational History of Ohio (Columbus, 1905). 

Hinsdale, B. A., History of Popular Education on the Western Reserve (Ohio 

Archselogical and Historical Society Publications, Vol. VI, 1898, pp. 35-58.) 
Hinsdale, Mary L., A Legislative History of the Public School System of the State 

of Ohio (Report of the United States Commissioner of Education, 1900-01, 

Vol. I, Chap. II, pp. 129-160). 
Knight, Geo W., and Commons, John R., History of Higher Education in Ohio 

(Washington; United States Bureau of Education, Circular of Information, 

No. 5, 1891). 

* Consult also Mayo, above. 



466 PERMANENT COMMON SCHOOL FUNDS 

Orth, S. p., Centralization of Administration in Ohio (New York, 1903). 

Growth of Ohio School System (Report State Commissioner of Common Schools, 

1900, pp. 9-1 1). 
School Legislation in Ohio (Report State Commissioner of Common Schools, 1892, 

pp. 1-16). 
Tables Showing Progress of Schools, 1837-1856 (State Commissioner of Common 

Schools, Report, 1856, pp. 50-51). 

Pennsylvania * 

Barnard, Henry, Thomas H. Burrows, with a Sketch of a History of Common 

Schools in Pennsylvania (American Journal of Education, Vol. VI, pp. 107- 

124). 
Haskins, C. H., and Hull, W. J., History of Higher Education in Pennsylvania 

(Washington; United States Bureau of Education, Circular of Information, 

No. 4, 1902). 
Wickersham, James Pyle, History of Education in Pennsylvania (Inquirer 

Publishing Company, Lancaster, Pa., 1886). 

Rhode Island * 

Stockwell, Thos. B., History of Public Education in Rhode Island, 1636-1876 

(Providence, R. I., 1876). 
Tolman, Wm. H., History of Education in Rhode Island (Washington; United 

States Bureau of Education, Circular of Information, No. i, 1894). 

South Carolina * 

McCrady, Edward, Education in South Carolina Prior to and During the Revolu- 
tion (in South Carolina Historical Society Collections, Vol. IV, 1887, Charles- 
town). 

Merriwether, Colyer, History of Higher Education in South Carolina, with a 
Sketch of Free School System (Washington; United States Bureau of Education, 
Circular of Information, No. 3, 1888). 

Rammage, B. J., Social Government and Free Schools in South Carolina (Johns 
Hopkins University Studies, Vol. I, No. 12, Baltimore, 1883). 

Historical Documents Bearing upon Common School Education in Virginia and 
South Carolina Previous to the Civil War (Report of United States Commis- 
sioner of Education, 1899-1900, Vol. I, pp. 403-426). 

Tennessee * 

Merriam, Lucius S., Higher Education in Tennessee (Washington; United States 
Bureau of Education, Circular of Information, No. 5, 1893). 

History of Education in Tennessee (Report Supt. of Public Instruction, 1890-91, 
pp. 22-60). 

* Consult also Mayo, above. 



BIBLIOGRAPHY 467 

Texas 

Lane, J. J., History of Education in Texas (Washington; United States Bureau of 
Education, Circular of Information, No. 2, 1903). 



Utah 

RoYLANCE, Wm. G., History of Education in Utah (Report Supt. of Public In- 
struction, 1898-1900, pp. 46-56). 

Vermont * 

The School Reports for the following years contain valuable material regarding 
the school funds: 1869, pp. 133 ff.; 1874, pp. 439-440; 1890, p. 296. 

Bush, George Gary, History of Education in Vermont (Washington; United 
States Bureau of Education, Circular of Information, No. 4, 1900). 

Virginia f 

Adams, Herbert B., Jefferson and the University of Virginia (Washington; United 
States Bureau of Education, Circular of Information, No. i, 1888). 

Mayo, A. D., Education in Southwestern Virginia (Report United States Commis- 
sioner of Education, 1890-91, Chap. 24, pp, 881-921). 

Neill, Edward D., Virginia Carolorum, The Colony under the Rule of Charles I 
and II, A. D. 1625 to A. D. 1685, Based upon Manuscripts and Documents of 
the Period (Joel Munsell's Sons, Albany, N. Y., 1886). 

The Past Primary School Systems of Virginia (Virginia School Report, 1871, pp. 
89-92). 

History of County and City Schools of Virginia (Report Supt. of Public Instruction, 
1885, Part III, pp. 48-296). 

West Virginia 

Miller, Thos. C, History of Education in West Virginia (printed separately, 
and in Report of State Supt. of Free Schools, 1904, Charlestown, West Virginia, 
1904). 

Morgan, Benjamin S., and Cork, J. F., West Virginia Free Schools (printed in 
Report of the Supt. of Free Schools, 1891-92, pp. 1-20; also published sepa- 
rately, 1893, Charlestown, West Va.). 

Whitehill, a. R., History of Education in West Virginia (Washington; United 
States Bureau of Education, Circular of Information, No. i, 1902). 

* Consult also Mayo, above. 

I Cf. Bibliography on South Carolina. 



468 PERMANENT COMMON SCHOOL FUNDS 

Wisconsin 

Allen, William F., and Spencer, David E., Higher Education in Wisconsin 
(Washington; United States Bureau of Education, Circular of Information, 
No. I, 1889). 

Salisbury, Albert, Historical Sketch of Normal Instruction in Wisconsin (White- 
water, Wis., 1893). 

Whitford, W. C, Historical Sketch of Education in Wisconsin (Report Supt. of 
Public Instruction, 1876, pp. 321-393). 



INDEX 



Academies, early prevalence, Mass., 
5; land grants for, Ga., 248; Texas, 
401; supported by permanent funds, 
N. Y., 351, 354; Penn., 384; Wis., 
433; see also Private schools 
Accounts, permanent, 7; see 0/50 Credit 

funds; Debts 
Act of 1 8 41, see Internal improvement 

under Lands 
Acts quoted 

Connecticut School Fund Acts, 1793, 

1795, 231-234 
Georgia County Land Grant Act, 

36- 
Kentucky: "Act ... for the burn- 
ing . . . state bonds," 152-153 
Massachusetts School Fund Acts, 

creation, 302; management, 309; 

apportionment, 309-310 
New Mexico Land Grant Act, 347 
New York Common School Fund 

Act, 353 
Ohio Common School Fund Act, 

1838, 375 
Pennsylvania Common School Fund 

Act of 17S6, 384; Act of 18 31, 

38s 
Tennessee Permanent School Fund 

Act, 396 
Vermont Permanent Public School 
Fund Act, 1906, 416-419; see also 
Constitutions; Ordinances 
Administration, centralization of, 118 
Admission of States, Table XVI, 98-99 
Age, school, see Apportionment 
Agricultural College lands, Nev., 336 
Agricultural fund, balance increases 

permanent funds, N. C, 362 
Aims of school funds, 165, 168, 171, 180, 

189-190 
Alabama 

^unds for schools: 
Educational Fund, 207, 210 
Permanent School Funds, 160, 
109-110, 132, 153, 158, 207-212 
Public School Fund, 207 
School Fund, 207 

Surplus Revenue Loan, 72, 74, 
158, 207, 208, 209, 210, 211 



interest, unpaid, on notes, 143 
lands for schools, swamp lands, 63- 
64; titles in dispute, 132; section 
sixteen, 207, 208, 209, 2n 
notes unpaid, 143 

Alaska, no school fund, 10; appropri- 
ations, federal, 24, 25, 213 

Animal tax, devoted to public schools, 
Ga., 247 

Apparatus, a lawful expenditure, Ore., 
382; _Va., 422; Wis., 433 

Apportionment of permanent school 
funds, 180-185; Table, 186-188; aims, 
190; better methods needed, 202- 
203; in Ala., 212; Ark., 220; Cal., 
224, 225; Col., 227; Conn., 228, 233, 
236; Del., 241; Fla., 245; Idaho, 
252; 111., 257; Ind., 266; Iowa, 270; 
Kan., 274; Ky., 277; La., 282; Me., 
292, 29s; Md., 297; Mass., 302, 304, 
309-310; Mich., 315; Minn., 126- 
127, 320; Mo., 324; Miss., 326, 327; 
Mont., 330; Neb., 333; Nev., 337; 
N. H., 338; N. J., 342, 344-345; 
N. Y., 356, 358-359; N. Dak., 366; 
Ohio, 368, 375, 377; Ore., 382; Penn., 
386; R. I., 388; S. Dak., 392; Tenn., 
399; Tex., 405; Vt., 412, 418, 419; 
Va., 421; Wash., 425; W. Va., 428; 
Wis., 433; Wyo., 436 

Appropriations, federal, Alaska, 24, 
213; D. C, 25, 80; Indian Ter., 56, 
80, 259; Okla., 378; state, Ala., 210; 
Del., 240; Fla., 243; Ga., 90, 248; 
La., 24, 282; Me., 295; Mass., 90, 
305, 306, 309, Table XLV, 452; 
Mo., 323; Mont., 330; N. Y., 24, 
351; R. I., 90; Texas, 405; town, 24 

Architectural requirements, N. J., 346 

Area, as apportionment basis, Miss., 

327 

Area of land grants: sections sixteen 
and thirty-six, 57-58; internal im- 
provement, saline, swamp lands, 
66; state, 85 

Area of unsold school lands. Table 
VII, 20-21 

Arizona 
funds: County School Fund, 215; 
469 



470 



INDEX 



Permanent Common School Fund, 
214, n.*; Territorial School Fund, 

215 

lands for schools: denuded, 141; 
area, 214; rent, 214; sale, 214 
and n.* 
school receipts, 1905, 214 
school tax, territorial, 30, 31, 215 
Arkansas 

funds for schools, 100; Common 
School Fund, 158, 216, 217, 218; 
Per Centum Fund, 146, 219; Per- 
manent School Fund, 145, 146, 
216-220; see also Credit funds, 
8; Saline Fund, 147, 218; Seminary 
Fund, 147, 218; Sixteenth Section 
Fund: merged, 112, 218; Surplus 
Revenue Loan Fund, 74, 100, 
158, 217, 218 
lands for schools: internal improve- 
ment lands, 219; salt lands, 219; 
section sixteen, 216-217,218; swamp 
lands, 62-63, 219 
rate bills: 3; 27 
Ashe, W. W., forester, N. Ca., letter 

quoted, 361-362 
Assessed valuation, as apportionment 
basis: Mass., 309-310; N. Y., 358, 359 
Attendance as apportionment basis: 
minimum, Fla., 178, 246; Neb., 334; 
advantages, 181-183; states em- 
ploying, Table, 186-188; attendance 
increased by influence of permanent 
school funds, 183 
Attorney-General, relation to school 
funds, in Kan., 273; Mont., 330; 
Neb., 333; N. J., 344; N. Dak., 
366; Va., 421; Wis., 433 
Auction fees devoted to school funds, 

N. C, 86; R. I., 388 
Auction of Louisiana Free School Fund, 

150-151, 281 
Auditor, County, relation to school 

funds, Ind., 266 
Auditor, state, relation to school funds. 
Ark., 219; Iowa, 269-270; Ky., 275, 
277; Minn., 319; W. Va., 428 

Back Bay lands, Mass., 304-305, 307, 
308, Table XLV, 452 

Balances, added to principal, Me., 
291, 295; Mass., 91-92, 304, 309, 
452; N. H., 338; N. Dak., 366; R. L, 
91-92; W. Va., 427 

Balances, reapportioned, Cal., 225; 
N. J., 345 

Baltimore & Wash. R. R., income de- 
voted to schools, 297 



Bank failures involving school funds: 
Ala., 144, 208, 209; Miss., 144, 327; 
N. C, 144, 363; Tenn., 144, 398- 
399; Wyo., 144, 435 

Bank moneys devoted to school funds: 
revenue, Ohio, 375; stock, Ind., Ky., 
N. C, N. J., Tenn., Vt., 88; Ga., 
247-248; Ky., 275, 276; Miss., 326; 
N. J., 343; N. C, 362; Tenn., 397; 
Vt., 409 

Bank taxes, a source of school revenue: 
Ind., 31, 70, 89, loi, 262, 263; Me., 
31, 287-288, 293, 294, 447, 448; 
Md., 89, 296; N. H., 340; Vt., 89, 
409; see also United States Bank Tax 

Banks capitalized with school funds. 
Ark., 217; Ind., 263; Tenn., 144 

Bartlett, Robert, bequest, 34 

Beers, Seth P., Commissioner of Con- 
necticut School Fund, 235 

Bequests for endowing schools: Simms, 
33; Peasley, 34; Mason, 34; Hopkins, 
34; Bartlett, 34 

Bequests, increase permanent school 
funds: La., 282; Mont., 330; Nev., 
336; Ore., 381; Vt., 416; Wash., 
424; W. Va., 427; see also Devises; 
Gifts 

Bequests to board of education, Ga., 247 

Blind school aided by swamp lands, 
Minn., 318 

Board of Commissioners, School and 
University Lands: Ark., 219; Kan., 
273; Ore., 382; Wis., 433 

Board of County Supervisors, Miss., 

327 

Board of Education, State: manages 
school funds, 120-121; Fla., 113, 245; 
Mo., 324; Texas, 405; Va., 421; sup- 
ported by permanent school fund, 
Va., 422 

Board of Educational Lands and Funds, 
Neb., 333 

Board of Investment, Minn., 319 

Board of Land Commissioners, State, 
120; Mont., 330; Utah, 407; Wash., 
424 

Board of School Land Commissioners, 
Wyo., 120, 435 

Board of University and School Lands, 
N. Dak., 366 

Board, teachers', see Teachers' board 

Boards managing school funds, com- 
position, 1 20-1 21 

Bonds, as securities: county. Ark., 216; 
Cal., 222; Mont., 329; Neb., 332; 
S. Dak., 391; Tex., 400; W. Va., 426; 
Wyo., 434; foreign, Minn., 316; 



INDEX 



\ 471 



district, Id., 251; N. Dak., 365; 
Ore., 380; Utah, 406; W. Va., 426; 
Wis., 429; Wyo., 434; state. Ark., 
216; Cal., 222; Del., 238; Fla., 243; 
Idaho, 251; Ky., 276; Md., 296; 
Minn., 316; Mont., 329; Neb., 332; 
Nev., 335; S. Dak., 391; Tex., 400; 
Vt., 415; Va., 420; town, Mass., 
299; S. Dak., 391; Vt., 415; United 
States, Fla., 243; Neb., 332; Nev., 
335; Vt., 415; irredeemable, Nev., 
335; municipal, Cal., 222; Mass., 
299; Minn., 316; Mont., 329; S. Dak., 
391; Utah, 406; Vt., 415; Va., 426; 
railroad, Mass., 299, 305; school 
district, Mont., 329; S. Dak., 391; 
Tex., 400; Utah, 406; Vt., 415; W. 
Va., 426; Wyo., 434. 
Bonds, fraudulent, N. C, 1 51-15 2 
Bonds, payment of. Ark., 216; Ky., 

275; see also Bonds, irredeemable 
Bonds' profit, increase permanent school 

funds, Minn., 319 
Bonds required of school ofl&cers. 111., 

258; Ind., 267; Ore., 382 
Bonds, state, given for school fund: 
Ark., 216; Cal., 222; Iowa, 268; La., 
279 
Books, free text; 174, Table XXI; 
Del., 241; Me., 179, 292; Md., 298; 
Mass., 310; Mont., 331; Va., 422 
Books, library, see Library books 
Boone, R. G., referred to, iii, 239 
Boston, school lands reserved, 34 
Boston Society of Natural History 

aided with School Fund, 307 
Bourne, E. G., cited, 73, 74-78, 297, 375 
Bridge revenues devoted to school 

fimds: Nev., 336; Ohio, 375 
Broadhead, Colonel, 42 
Building tax: Me., 30; Minn., 30 
Buildings, school, erected with per- 
manent school fund income, 174, 
198-199; Miss., 328; N. C, 362, 
364; Wis., 429 

California 
funds for schools, 8, 100; per centum 
grant, 69, 223; Perpetual School 
Fund, 221; State School Fund, 
7, 8,_5S,_ 61, 131, 147, 221, 225; 
constitutional provisions, 222-223 
lands for schools: internal improve- 
ment, 61; rents of, reserved, 91; 
sections sixteen and thirty-six, 
55, 61, 113, 118, 158, 221; unsold, 
221; value unequal, 117-118 

California, superintendent of schools, 



office created, 197; township manage- 
ment, losses, 131 
Cambridge land grant, 35 
Canal lands, Ohio, 370 
Cape money, 31 
Capital, original, of common school 

funds, 106; see also Origin 
Care of school funds, N. Y., 349 
Care of school lands, 124-128, 140; 

see also Constitutional provisions 
Census, as apportionment basis: school, 

180-182; Ala., .211, 212; Ark., 220; 

Col., 227; Conn., 236; Id., 252; 

111., 257; Ind., 266; la., 270; Kan., 

274; Ky., 277; La., 282; Me., 291; 

292, 29s; Md., 297; Mich., 315; 

Mo., 324; Mont., 330; Neb., 333; 

Nev., 337; Ohio, 379; Ore., 382; 

R. I., 388; S. Dak., 392; Tex., 405; 

Utah, 407; Va., 421; W. Va., 428; 

Wis., 433; Wyo., 436 

total, 180, 184; N. Y., 359 
Census, required, see Returns 
Census, school, tables:Conn., 1825-1895, 

Table XXVIII, 440; Me., 1831-1902, 

Table XLII, 448; Mass., 1837-1905, 

Table XLIV, 451 
Certification, see Teachers must be 

certified 
Cessions of western lands, see Land 

cession by states; Northwest Territory 
Charitable institutions supported by 

swamp land fund, Minn., 316, 318 
Charity schools, D. C., 32, 242; see also 

Poor School Fund under Funds 
Charles II, 40, 229 
Charlestown, colonial grant, 35 
Church Lands, see Funds, ministerial, 

under Fund 
Civil War, disastrous effects upon 

school funds, 144, 150-153; Fla., 

244; Ga., 250; Ky., 276-277; La., 

281; Mass., 307; Mo., 151; N. Car., 

363; Tenn., 399; Va., 420; Wis., 

429, 432 
Classification of permanent common 

school funds, 6 
Coahuila, Mexican state of, 401 
Colonial records quoted: Hartford, 

25; New Haven, 26, 29; Weathers- 
field, 28 
Colonial school, endowments and 

sources of support, 24-35 
Colorado 

Public School Fund, 22, 154-155, 
158, 226-227 

sixteenth and thirty-sixth section 
school lands, 117-118, 226, 227 



472 



INDEX 



Co^red scnool monej's, Del., 240, 241 

Conmission on Permanent Common 
ochool Fmid, Vt., 413 

Commissioners for managing school 
funds and lands, 119, 120; Ark., 
219; Conn., 23s; Kan., 273; Mass., 
308-309; Minn., 319; Mont., 330; 
Neb., 333; N. Y., 121, 358; Ore., 
382; Wash., 424; Wis., 433; Wyo., 
435; see also Board of Commission- 
ers; management, state 

Common School Acts, Mo., 321; see 
also Acts quoted 

Composition of school funds, see In- 
crease, soiurces; Origin 

Comptroller, see Controller 

Compulsory education, principles, 3 ; pen- 
alty for not enforcing, N. Y., 179, 
360; see also Free schools; Taxation, 
compulsory 

Condition of permanent school funds: 
often unknown, 7-10, table showing, 
20-21; see also Credit funds; Debts 

Condition of permanent school funds: 
jgo2, Mo., 321; N. J., 342 
igo2 and 1904, Kan., 271; Utah, 

406 
1903, Idaho, 251; Miss., 325, 326; 

Mich.,_ 312, 313 
J904, Wis., 429 

1905, Ala., 207; Ark., 216; Conn., 
228-229, 237; Fla., 243; Ga., 247; 
111., 254-255; 256-257; Ind., 260; 
Iowa, 268; Ky., 275; La., 279, 2S1; 
Me., 283, 285-2S6, 289; Mass., 
299; Mont., 329; Neb., 332; N. H., 
338, 341; N. J., 342; N. M., 347, 
348 foot-note; N. Y., 349; N. Dak., 
365; Ohio, 368; Okla., 378; Penn., 
383; R. I., 387; Tenn., 394; Tex., 
400; Va., 420; W. Va., 426 

1905-1906, Ariz., 214; Del., 23S 

1906, Cal., 221-222, 223; Col., 226; 
Md., 296; Nev., 335; N. J., 342; 
N. C., 361-362; Ore., 3S0; S. C, 
389; S. Dak., 391; Vt., 408-409; 
Wash., 423-424; Wyo., 434 

1908, Minn., 316 
Confiscations devoted to permanent 

school fimds, Miss., 326; Va., 86, 

420 
Congressional acts quoted 

Internal improvement land grant, 
1841, 60-61; Percentum grant, N. 
M., 347; Section sixteen grant, 
Mich., 112; Ohio, 51; lands in heu 
of, 53; sections sixteen and thirty- 
sLx, Ore., 54; Swamp land grant, 62- 



63; Tenn. grant, 395-396; United 
States Surplus Revenue Act, 1S36, 
71; see also EnabUng Acts; 
Ordinances; Resolutions 
Congressional grants, see Federal lands : 

Grants 
Connecticut 

appropriations, colonial, 24; census, 
school, 1825-1895, Table, 440; 
charter, 40, 229; Code of 1650, 29; 
Code of 1700, 30, 167; expenditures, 
total, for public education, 1855- 
1895, 439; free schools, 166-167, 
168; sec also Codes of 1650 and lyoo 
under Connecticut 
funds for schools 

classified, 100-106; colonial funds, 
34-36; School Fund, 5, 6, 28, 82, 
122, 142, 158, 165-168, 171, 175, 
176, 180, 191, 198, 228-237, 301, 
437-438; Town Deposit Fund, or 
Siuplus Revenue Fund, 73, 74, 
100, 131, 158, 237, 439; town 
school fimds, 34, 35-36; income, 
1855-1895, 439 
funds for the ministry, 35-36, 231; 
gifts, 439; land claims, 40, 42, 

43 

lands for ministry, 35-36, 231 

lands for schools, controversy, 35; 

origin, area, sale, 35, 229-231; 

see also Bequests; Funds; Land 

claims; Western Reserve 
Pennsylvania Land Case, 230 
rate bills, 3, 25-26, 1S56-1S68, 28; 

abolished, 27 
school receipts, total, 1856-1868, 

Table IX, 28 
school returns, 175 ] 

school society, 232, 233, 234 
school support, colonial, 23, 28, 29, 

30; compulsory, 29, 30; sources, 

1825-1895, 439, 440 
Supt. of Common Schools, oflSce 

created, 197 
siu'vey system, colonial, 35, 36 
taxes for schools, cease, 228; co- 
lonial, 29-30; District Tax, 1S56- 

1868, Table IX, 28; tea tax, 31; 

license taxes, 31; liquor tax, 

teachers, qualification of, 191 
teachers' wages, 1847-1907, Table 

XXIV, 192-193; 1S68-1900, total 

expenditure for, average. Table 

XXIX, 440 
Western Reserve or New Conn., 

43; sale, area, 82, 85; boimdaries, 



INDEX 



473 



origin, management, sale, pro- 
ceeds, basis of School Fund, 229- 
234; survey and land reservations, 
369-372 

Constitutional provisions concerning 
permanent common schools funds 
and lands, 124-128; Ala., 209; Ark., 
217; Cal., 222-223; Col., 226-227; 
Fla., 244; Id., 252; 111., 255; Ind., 
261; la., 269; Kan., 67, 127, 272; 
Ky., 276; La., 279, 280, 281; Mich., 
125, 312, 313; Miim., 126, 127, 
317, 318; Mont., 330; Neb., 127, 
332, 333; Nev., 335, 336, 337; N. Y., 
353-354, 355; N. Dak., 128, 366; 
Ohio, 372; Ore., 126; S. C, 389- 
390; S. Dak., 128, 392; Tenn., 397; 
Tex., 402-403; Utah, 407; Wash., 
128, 424; W. Va., 426-427; Wis., 
430, 433; Wyo., 435 

Constitutions quoted: Ala., 209; Col., 
226-227; Ga., 1783, 36; Kans., 67; 
Mich., 125; Minn., 126-127; Nev., 
337; N. Y., 354; Ore., 126; S. C, 
389-390; Tex., 1845, 402 

Controller, relation to permanent school 
funds: accountant, Cal., 223; ap- 
portions income. Conn., 236; Md., 
297; Tenn., 399; to management, 
120; N. J., 344; N. Y., 358; Te.x., 
405 

Conveyance, see Transportation 

Convicts, hire, devoted to schools, 
Ga., 247, 248 

Corporation moneys: charter fees de- 
voted to permanent school funds: 
Kan., 273; shares or dividends. Id., 
252; Utah, 407; see also Bank moneys; 
Bonds 

Corporation taxes: devoted to per- 
manent funds, Ind., 264; W. Va., 
427; unpaid, Ind., 147-148, 264-265; 
see also Bank taxes 

Coimty Auditor: distributes school 
revenue, Ind., 266; la., 270; loans 
school funds, Ind., 266 

County boards of supervisors, 115, 
269-270, 327, 328 

County Superintendent: apportions 
school moneys, Kan., 274; N. J., 
345; estimates census, Cal., 224; 
fined, 252; manages funds, iii, 257; 
salary paid from permanent school 
funds, N. J., 345 

Course of study influenced by per- 
manent school funds, 177; Me., 
Mich., N. Y., 179, 292; Wash., 
425 



Creation of permanent common school 
funds, 93, 95, 97, 98-106; see also 
Origin 

Credit funds: defined and classified, 
6-7; reported intact, 7; significance, 
155-157J 202; States possessing: 
Ala., 208; Ark., 216; Cal., 7, 222; 
Conn., 237; Del., 8; La., 7, 154, 279, 
281; Me., 7, 283; Mich., 7, 312-313; 
Miss., 325; Neb., 332; Nev., 336- 
337; N. H., 338, 340; N. J., 344; 
Ohio, 7, 368; Tenn., 7, 394; Vt., 
408, 409, 414; Wis., 431; Tables: 
Table I, 8; Table VII, 20-21; Table 
XX, 158-159; see also Accounts; 
Debts 

Cubberley, E. P., referred to, 180, 
202 

Cutler, Manasseh; urges school land 
grant, 45, 46, 47, 50 

Data, school, difficulty of securing, iii, 

iv, 6; unascertainable, 164 
Deaf school aided by swamp lands, 

Minnesota, 318 
Deaf, teachers for, California, 224 
Debts, states', to permanent school 

funds: Cal., 147; Col., 227; Fla., 147, 

150; Id., 251; 111., 255; Kan., 273; 

Minn., 318; Miss., 325; Neb., 332; 

Nev., 336; N. H., 338, 340; N. Dak; 

365; R. I., 153, 388; Tenn., 394, 

399; Tex., 400; Vt., 413, 414; Wash., 

423; Wis., 429, 431; prohibited by 

constitution, W. Va., 156, 426; 

repudiated. Col., 155, 227; N. C, 

151-152; Vt., 154, 410; see also 

Credit funds 
Defalcation of school fund officers: 

Mo., 133; N. Y., 358; Tenn., 145, 

398; Wis., 430 
Delaware 

license moneys: marriage, tavern, et 
al., 86, 238, 239 

Public School Fund, 8, 238-241 

rate bills, 27 

sanitary requirements, 198, 241 

Surplus Revenue Loan Fund, 72, 
75, 239 
Denominational schools, see Religious 

and sectarian schools 
Devises devoted to permanent school 

funds: Ark., 219; Col., 227; Ky., 

277; Mo., 323, 324; Ohio, 374; Ore., 

381; W. Va., 427 
Devises to State Board of Education, 

Ga., 247 
Dexter, E. G., referred to, iii 



474 



INDEX 



Direct tax, 88, 89; devoted to per- 
manent school funds, Mass., 305; 
_S. C, 390 

Dishonesty of land commissioners, 
Ind., 265; see also Defalcations; 
Embezzlement 

District Board of Directors, Mo., 324 

District bonds, see under Bonds 

District of Columbia: no permanent 
school fund, 10; federal appropriations 
for schools, 25, 80; lotteries, 32-33, 
242; school fund, 242; school lots, 242 

District quota, New York, 358-359 

District tax: Conn., 18 56-1 868, Table, 
28; la., 268; Mo., 324; Wis., 433 

District trustees: Mont., 331 

Diversion of funds: Ala., 153; Ky., 
153-154. 275, 276; La., 281; Mass., 
307-308; N. H., 341; Penn., 384, 386 

Diversion of moneys reserved for 
principal: Mo., 323; Va., 421; Wis., 

430, 431, 432 
Diversion of principal: Ark., 146, 

147, 217, 218; Fla., 147; Ind., 147; 

Kan., 148; Va., 148; Wis., 148-149 
Diversion of school moneys, 147-149; 

Ala., 210; Ga., 4, 250; see also Loss 
Division superintendents paid from 

common school funds, Va., 422 
Documents quoted, see Acts; Colonial 

records; Congressional acts; Constitu- 
tions; Enabling Acts; Ordinances; 

Resolutions 
Dohmrore's grant, Ohio, 370 
Donations to permanent school funds: 

Fla., 24s; Mont., 330; Ohio, 374; 

S. Dak., 392; Va., 421; Wash., 424; 

see also Gifts 
Dorchester: school lands reserved, 

34 
Draper, Lyman C, on loss of school 

lands, Wis., 141 

"Eastern" lands in Maine and Mas- 
sachustts, 284 

Education, State Department, ex- 
penses paid from school fund, Ky., 
277; Mass., 304 and n.* 

Effects, see Influence, 

Embezzlement, 145, 146; Neb., 333; 
see also Defalcation 

Enabling Acts: quoted, Ohio, 51; Ore., 
54; provisions of, 93; Mont., 329; 
Ohio, 369; Utah, 407; inequity of 
land grants, 371; modified, 372 

Endowments, see Funds 

England, land claims, 40 

Escheats devoted to permanent com- 



mon school funds, 86-87; Ark., 219; 
Col., 227; Fla., 245; Id., 252; la., 
269; La., 280, 282; Mich., 315; Miss., 
326; Mo., 323; Mont., 330; Neb., 
333; Nev., 336; Ore., 381; S. C, 
390; S. Dak., 392; Tenn., 397, 399; 
Utah, 407; Va., 420, 421; Wash., 
424; W. Va., 427; Wyo., 435; see also 
Intestate estates; lost, Ind., 264; 
reserved but not added, Va., 421 
Establishment of school funds, steps, 

93; see also Creation; Evolution 
Estrays, Ark., 219; Ind., 264; Mo., 323 
Evolution of permanent common school 
funds, 33-37, 93-97; see also Increase, 
sources of 
Examiners, State, paid from per- 
manent school funds, Va., 422 
Excise moneys, see under Liquor 
Expenditures, lawful, see Uses, lawful 
Expenditures, total, for public schools; 
Conn., 1855-1895, 439; Fla., 1870- 
1905, 441; Me., 1851-1902, Table 
XLII, 448; Mass., 1835-1905, Table 
XLIV, 450; N. Y., 1831-1900, Table 
XLVII, 455 

Fairfield, town school grant, 35 

Farm loans, see Mortgages 

Federal aid to schools, 39-80, 100- 
106, 203 

Federal appropriations, see Appropri- 
ations; Federal money grants 

Federal lands: grants, 43-66, 100-106; 
not taxed, 127; see also Congressional 
acts quoted, and under La^ids, In- 
ternal improvement lands; Salt 
lands; Section sixteen; Sections six- 
teen and thirty-six; Swamp lands 

Federal money grants, 67-80, 100-106; 
see also Appropriations, federal 

Fertilizers, inspection fees, 247-248 

Fines: used for current school revenue, 
Ariz., 214; diverted, Va., 148, 421; 
Wis., 148-149, 432-433; increase 
of school funds: Ind., 87-88, 262- 
264; Table, 1868-1906, 443; Mo., 
322, 323; Miss., 326; Mont., 330; 
Nev., 336; Ore., 381; Va., 420-421; 
Wash., 424; Wis., 88, 430 

Fire losses, Ark., 145, 219; Mo., 145 

Fish licenses, 31 

Fitchburg R. R. Securities Loan, 306, 

307 
Florida, expenditures, total, for public 
schools, i(?70-i"po5, 441; free schools, 
indifference to, 4, 162, 163, 164 

funds for schools: County School 



INDEX 



475 



Fund, 245; Seminary Fund, 150; 
Sixteenth Section Fund, 4, 244; 
State School Fund, 63, 11 2-1 13, 
114, 152, 158, 163, 182, 199, 243- 
246; Table, iSyo-igo^, 441 
lands for schools: management, town- 
ship changed to state, 112; sale of, 
4, 244, 245; sixteenth section 
lands, 150, 243-245; swamp lands, 
63; private schools, support, 163; 
rate bills, 27; rents of school lands, 
243; school returns, unascertain- 
able, 164 
Supt. of Schools, office created, 
197; taxes: mill, 245; poll, 245; 
town funds, see Sixteenth Section 
Fund 
Forest lands, wasted and denuded, 

140-141; Wis., 430, 431, 432 
Forfeiture of permanent school fund 
income: Conn., 233; Fla., 245; Ind., 
267; Mass., 91-92; N. J., 34s; N. Y., 
360; Rd. Is., 91-92, 388; Vt., 415, 
416, 418; Wash., 425 
Forfeitures devoted to permanent 
school funds, 86-88; Mass., 309, 
Table XLV, 452; Tenn., 399; Utah, 
407; Wash., 424; Wis., 430; Wyo., 

435 

Forged mortgages. New York, 358 

France, land claims of, 40 

Fraudulent bonds, Kan., 273; N. C, 
special tax, 363 

Free school acts, see Acts quoted 

Free schools, states maintaining, 3; 
established: Ark., 217; Conn., 300; 
Ga., 4, 248; Ky., 278; Me., 284, 288; 
Mass., 300; Mo., 321; N. Y., 300; 
Penn., 383-38$; S. C, 390; Tex., 
403; fostered by influence of per- 
manent common school funds, 5, 
33-36, 168, 179, 190-201, 248; hos- 
tility and indifference to, 3, 4, S, 
26, 160-165; Fla., 162, 163, 164; 
Ga., 162, 248, 249; Ind., 161, 162, 
163, 199; Miss., 162; N. H., 341; 
Tenn., 162, 163; Va., 162; see also 
Rate bills; Returns 

Fuel, 174, 198, 293, 310, 328 
Funds 

fund defined, 7, 8, 9, 221, 238, 254, 
275, 283 

Academy, Ga., 249 

Agricultural, N. C, 362 

Bank Tax, Ind., 262, 263 

Bounty, Mass., 307 

Chickasaw, Miss., 325-328 



Chocktaw, of Miss., 325-328 

Common Free School, Md., 296- 
298 

Common School, current revenue: 
Ark., 216; Ga., 247; Kan., 9; 
Neb., 9; Ohio, 368 

Common School, Permanent En- 
dowments, varied use of term, 
7, 9, 247; Ark., 216, 217, 218; 
Fla., 243, 244; Ga., 247; Ind., 
260, 261, 266-267; Ky., 276; 
Miss., 64; N. H., 338, 340-341; 
N._ Y., 349, 352-355, 356-360; 
Ohio, 9, 368; Ore., 380-382; Penn., 
383-386; Tenn., 9, 11, 144, 151, 
163; Vt., 409, 410; Wash., 423- 
425; Wis., 432 

Common School Permanent, Wyo., 
434-436 

Congressional Township, Ind., 260- 
267 

County School, Ariz., 215; Ark., 
218; Fla., 245; 111., 100, 254-258; 
Minn., 30; Mo., 63, 102, 321, 
322, 323, 324; Tex., 400, 401, 
402, 405 

County Seminary, Ind., loi, 262 

Delinquent Tax, Ind., 102, 262, 265 

District, Mo., 321-324 

Educational, Ala., 207, 210 

Five per cent, 312-315 

Free School, Ga., 249; La., 279- 
282; Md., 296-298; N. Y., 359 

Huntington, Vt., 312, 411, 413, 415, 
417, 418 

Indemnity Land, 207 

Institute, N. H., 84, 103, 159, 338- 

341 

Irreducible, W. Va., 426 

Irreducible School, Wis., 429 

Literary, Ky., 102, 275-276; Mass., 
301; Miss., 325, 327; N. H., 84, 
339, 340; N. Y., 228, 349, 350, 351, 
354, 357, 359; N. C, 88, 144, 151- 
152, 159, 198, 361-364; Va., 420- 
422 

local permanent, 5, 33-35; Conn., 
Mass., N. H., Va., 30; Conn., 
237, 439;^ Me., 283; N. Y., 455; 
see also District, Town and Town- 
ship Funds 

local private, :i,:^, 34 

local public, 34-37 

Mass. School, 299-311 

Mill, Me., 291, 294-295 

ministerial. Conn., 35, 36, 166, 231, 
232, 233; Me., 284-285; Mass., 
37; N. Y., 36, 37, 350; lands. 



476 



INDEX 



granted by United States, Ohio, 

46, 47, 48, 373 
New Jersey Permanent School, 342- 

346 
Per Centum Fund Act quoted, N. 

Mex., 347 
Per Centum, Ark., 219; 111., 255; 

la., 269; Kan., 272; La., 272, 280, 

282; Me., 290; Mont., 329; Neb., 

333; N. Dak., 366; N. Mex., 347; 

Okla., 379; Ore., 381; S. Dak., 

392; Wash., 424; Wis., 430; Wyo., 

435; see also Grants 
Permanent Public School, Vt., 408- 

419 
Permanent School, Ark., 100, 216; 

la., 268-270; Ky., 102, 275-278; 

Me., 283-295; Minn., 316-320; 

Neb., 159, 332-334; N. J., 342- 

346; N. Dak., 365-369; Rd., Is., 

387-388; S. C, 389-390; S. Dak., 

391-393; Tenn., 394-399; Tex., 

400-405 
Perpetual School, Cal., 100, 221-222; 

La., 280 
Poor School, D. C, Ga., Miss., Va., 

162, 242, 249, 351 
Primary School, Mich., 312-315 
Primary School Interest, Mich., 315 
Public School, Ala., 207; Col., 100, 

226-227; Del., 100, 238-241; Id., 

100, 251-253; Mo., 321-324; Mont., 

329-331 

Saline, Ark., 218; Ind., loi, 262-263; 
see also Salt land grant under Grants 

School, Ala., 207; Conn., 100, 228- 
237; Del., term defined, 238; Fla., 
100, 243; 111., 100, 158, 254-257; 
Mass., 82, 83, 84, 85, gi, 92, 159, 
169, 173, 176, 228; W. Va., 426- 
428; Wis., 429-433 

School Fund proper, 111., 254-258; 
Ind., 283; Me., 283 

School Indemnity Land, Ala., 207 

School Mill, Me., 291, 294-295 

School Trust, Wis., 429 

Seminary, Ark., 218; 111., 255; Ind., 
262; La., 281 

Seven Per cent, Mich., 312-315 

Sinking, Ind., loi, 262, 263; Ky., 
153) 275; Fitchburg Railroad Se- 
curities Loan, Mass., 306, 307 

Sixteenth Section, Ala., 100, 207, 
208, 210; Ark., 100, 218; Miss., 325; 
see also Section Sixteen under 
Lands, Township Fund under Funds 

Spanish War Claim, Vt., 79-80, 412- 
413, 416 



Special District, Mo., 324 

State Permanent School, Kan,, 159, 

271-274 
State School, Cal., 100, 221 S..; Fla., 

100, 243-246; Me., 283; Mont., 

329-331; Nev., 62, 118, 335-337; 

N. J., 340; Utah, 406-407 
State School Land, Cal., 100, 221 
Surplus Revenue Fund income, 

N. Y., 1831-igoo, Table XLVII, 

455 

Surplus Revenue of 1837, or U. S. 
Surplus Revenue Loan, 70-78; 
act quoted, 71; states using for 
schools, 72-74; Ala., 207-211; Ark., 
217, 218; Conn., 237, 439; Del., 239; 
Ga., 249; 111., 254, 255, 256, 257; 
Ind., 262, 263; Ky., 276; La., 280, 
281, 282; Me., 73, 76, 159, 289, n.*; 
Md., 296-297; Mass., 308; Mo., 
322; N. H., 339-340; N. J., 343- 
344; N. Y., 354-357, 359, 455; N. 
C, 363; Ohio, 374, 375; Penn., 
386; R. L, 387-388; S. C, 72, 78; 
Tenn., 397-399; Vt., 408, 410-41 1, 
413, 414, 415, 416, 418, 419; Va., 
72-78 

Surplus Revenue or Town Deposit 
income, Corm., i855-i8g5, 439 

Swamp Land, Ind., 102; Mich., 312- 
315; Minn., 63, 64, 102, 316-370 

Table XIII, showing for all states, 
amovuits received, used for schools, 
lost, original use, present con- 
dition, 74-78; see also imder Index 
for states 

Teachers', la., 268 

Territorial School, Ariz., 215 

Town, Colonial, 33-35; Me., 284- 
286; Mass., 308; N. Y., 350 

Town Deposit, Conn., 73, 74, 100, 
131, 158, 237, 439 

Township, 96-97, Cal., 100, 222; 
111., 100, 254-258; Mo., 1337138, 
159, 321-324; see also Congressional 
Township; Sixteenth Section; Town 
funds 

Tuition, N. Dak., defined, 365 

U. S. Deposit, of 1833, 69-70; of 
1837, see Surplus Revenue Fimd 

Universitv or Seminary, Ark., 218; 
lU., 255; N. H., 340; Okla, 

379 
Valueless Sixteenth Section, Ala., 

100, 207 ff. 
Furniture, tax for, Minn., 30; purchase 
of, 174; Col., 227; Miss., 328; Mont., 
331; Va., 422 



INDEX 



477 



Gambling moneys, 32, 87-88; Ariz., 

214; Ind.. 262 
Georgia 

Constitution, 1783, quoted, 36 

division of school moneys, 4 

free schools, 4, 36, 248 

funds: Academy Fund, 249; Com- 
mon School Fund, 9, 247, 248; 
Free School Fund, 249, 250; Poor 
School Fund, 162, 249; School 
Fund, 150, 158, 162, 248-250; 
Surplus Revenue Fund, 73, 75, 
158, 249 

land claims asserted, 40; ceded, 209 

land funds for schools, reserved, 
4, 36, 82, 8s, 248 

Land Lottery Act, 82 

receipts for common schools, 1836, 
4; jpo5, 248 

revenue for common schools, sources 
of, 10, 247, 248 
Gifts to permanent school funds, 86- 

88; Ark., 219; Col., 227; Fla., 245; 

Id., 252; Ky., 277; La., 282; Mich., 

315; Mo., 321, 323, 324; Nev., 336; 

N. C, 363; Ohio, 374; Ore., 381; 

S. C, 390; S. Dak., 392; Tenn., 

87-88, 397, 399; Vt., 416 
Gifts to support schools, Conn., 168; 

Ga., 247; Me., 284; Mass., 300 
"Gospel and School Lot," New York, 

36-37; see also Ministerial lands 

under Funds 
Governor, relation to school funds, 31; 

Mass., 308; Mich., 315; Minn., 319; 

Mont., 330; Neb., 333; N. H., 338; 

N. J., 344; N. Dak., 366; Ore., 382; 

R. L, 388; Tex., 405; Utah, 407; Vt., 

415; Va., 421; W. Va., 428; Wyo., 435 
Grammar schools, endowed, 33-34, 

35; decline, 167 
Grants, federal, see Congressional Acts, 

quoted; Federal lands; Federal money 
Grants, state moneys, 85-93; Table 

XVII, 100-106 
Grants, state, possible sources of in- 
creasing permanent school fimds: 

Ark., 219; Col., 227; Id., 252; Ky., 

277; La., 282; Mich., 112; Mo., 

321, 323, 324; Mont., 330; Nev., 

336; N. C, 363; Ohio, 374; S. C, 

392; W. Va., 427; Wis., 430 
Grass sales' proceeds, Me., 91, 285, 

290; Minn., 319 
Growth, see Increase 

Hadley, Conn., permanent school fund, 
34 



Hartford, Conn.: colonial school ap- 
propriation, 1642, 24; rate bills, 
164 J, 25; colonial permanent school 
funds, 34, 35 

Henry VIII, endowment of schools 
under, 33 

Hillhouse, J. H., First Commissioner 
of Conn. School Fund, 122-123, 
23s, 236 

Hopkins Bequest, 34 

Huntington, Arunah, bequest to Vt., 411 

Idaho 

grants. Five Per Centum, 68 

lands, sections 16 and 36, 251, 252 

Public School Fund, 251-253 and n. 
Ignorance concerning condition of 

school funds. 111., 7-10, 130, 140 
Illinois 

fines and forfeitures, 88 

free schools, 26 

funds for schools, importance of, 
19; classified, 100, 254; Common 
School, defined, 254; County 
School, no, 254, 255, 256, 257; 
School Fund Proper, 158, 254- 
258; Surplus Revenue, 73, 75, 
159, 254, 25s, 256; _ Township, 
no, 254, 255, 257; University Per 
Centum, 255 

Grants, per centum, 68, 255 

lands for schools, county sales, 256, 
257; owned by township, in; 
military, 314; section 16, 255- 
256, 257; swamp, 63, 256-257 

receipts for common schools, igoS'. 
total, 255; from permanent fimds, 

255 
Importance of permanent common 
school funds, 16, 19, 20; 111., S. Dak., 
19; Col., Me., Mass., Nev., Tex., 
Vt., Wyo., 22; N. Y., 349, 350; see 
also Condition of permanent school 
funds; Per cent of total common 
school revenue 
Income: Conn., sources, 182^-1 8gs> 
Table, 439; per child, from all 
sources, i825-i8g5, Table, 440 
Fla. State School Fund, i8yo-igo^, 

Table XXX, 441 
Ind. Common School and Congress- 
ional Township Funds, i86^-igo6, 
Table, XXXV, 444 
Ind. permanent funds and taxation, 

i866-igo6, Table, 445 
Me. Permanent School Fund, 1851- 
igo5, Table, 446; sources, total 
and per child, Table, 448 



478 



INDEX 



Mass. School Fund and local tax, 
i8 35-1 go 5, Table XLIV, 450-451 

N. Y. Common School Fund, U. S. 

Deposit Fund, state appropriation, 

i'jg6-igos, Table, 453-454; sources, 

1831-igoo, Table, 455 

See also Apportionment; Participation, 

conditions; Uses 
Income and per cent of total common 

school revenue, all states. Table 

VII, 20-21 
Income, composition prior to exhaustion 

of lands, 95 
Income, first distributed. Conn., 166, 

228; Mass., 195; Me., 169, 284, 289; 

Miss., 326; N. Y., 195 
Income, igo^, derived from permanent 

funds. Local and State Tax, all 

states. Table VI, 17-18 
Increase of permanent common school 

funds, principal and income. Conn., 

i7gg-igo5, 437; Fla., iSyo-igos, 441; 

Ind., 443, 444; Me., i8jg-igo6, 446; 

Mass., 1835-igos, 450-451; N. Y., 

iyg6-igos, 453-454 
Increase, sources of, Ala., 211; Ariz., 

214, n.*; Ark., 219; Cal., 223; Col., 

227; Conn., 235-236; Del., 239, 240; 

Fla., 245; Id., 252; 111., 257; Ind., 

264-266, 442-443; la., 269; Kan., 

273; Ky., 277; La., 280, 281, 282; 

Me., 289-291, 295; Mass., 303-307, 

309, 452; Mich., 315; Minn., 319; 

Mo., 323-324; Miss., 327; Mont., 330; 

Neb., 333; Nev., 336; N. H., 338; 

N. J., 344; N. Max., 348 n.*; N. Y., 

351, 354-355; N. C, 363-364; 

N. Dak., 366; Ohio, 375, 376; 

Okla, 378, 379; Ore., 381; R. I., 

388; S. C, 389, 390; S. Dak., 392; 

Tenn., 399; Tex., 403, 405; Utah, 

407; Vt., 416; Va., 420, 421; Wash., 

424; Wis., 430; Wyo., 435 
Indian lands, granted to Tenn., 53; 

appropriation in lieu of, Ind. Ty., 

259; purchased by Ind., 266; Kan., 

school sections in, 272; Miss., 325 
Indian reservation, teachers' moneys, 

N. Y., 359 
Indian school endowed, Va., ^^ 
Indian Territory, federal appropriations, 

56, 80, 259 
Indiana 

escheated estates, lost, 146-147 

fines and forfeitures, 87-88, 146 

free schools, early conditions, 161, 
163; funds used for private 
purposes, 162-163; growth of sys- 



tem, 1855-1885, Table XXXVIII, 

44S 

funds devoted to schools, Bank Tax 
Fund, 70, 262, 263; Common 
School and Congressional Town- 
ship, 5, 64, 114, 116, 145, 146, 
147-148, 159, 200, 260-266; Tables, 
87, 442-445; County Seminary, 
87, loi, 262, 442; Delinquent Tax, 
102, 262, 265, 442; Saline, 59-60, 
262-263; Sinking, loi, 262, 263, 
442; Surplus Revenue Loan, 73, 
75, 262, 263; Swamp Land, 64, 
102, 145-146 

lands devoted to schools, saline 
lands, 59-60; value, 60; swamp 
lands, 63-64, 265 

private schools, supported with per- 
manent school funds, 162-163; 

rate bills, 3, 27; receipts for common 
schools, igoj, 260; 

tax, school, 164, 165, 198; local. 
Table, 1 866-1 go6, 445; 

teachers' wages, 192-193 
Influence of permanent common school 

funds, attendance, 183; free schools, 

168, 190-201; school term, 167, 176; 

organization, 194-300; returns, 175, 

194-196; supervision, 196-197, 199; 

taxation, 165-170, 176, 191-198; 

teachers' wages and board, 171, 191, 

192-193; see also Effects 
Inheritance tax devoted to permanent 

school funds. La., 282 
Insane asylum supported by swamp 

lands, Minn., 318 
Inspection of schools, required. Conn., 

178, 198, 237 
Institute of Technology, Mass. School 

Fund diverted to, 307 
Institutes, teachers', supported by 

permanent school funds, N. H., 

338; S. C, 389 
Insurance, a lawful expenditure, Mont., 

331 
Insurance revenue devoted to common 

school fund, Ohio, 375 
Intact funds, 6; Table VII, 20-21 
Interest on permanent school fund, 
debts, paid out of taxes, 155-157; 
Ala., 208, 210; Cal., 222; Conn., 
237; Id., 251; la., 268; La., 279, 281; 
Mich., 314, 315; Minn., 318; Neb., 
332; Nev., 337; N. H., 338-340; N. 
Dak., 365; Ohio, 109, 368; Tenn., 
394; Tex., 400; Vt., 414; Wash., 
423; Wis., 129, 157, 429; derived 
from sinking fund, Ky., 275, 277; 



INDEX 



479 



paid by appropriations, Fla., 243; 
rate paid by states on credit funds 
or loans, Table VII, 20-21; unpaid, 
Ala., Kan., Miss., Mo., 143; Tex., 
143-144, 404; Conn., 235 

Internal improvement lands, see under 
Lands 

Intestate estates devoted to permanent 
school funds, 87; Ark., 219; Cal., 
223; Kan., 273; Tenn., 397, 399; 
W. Va., 427; Wyo., 435; see also 
Escheats 

Investigation of lands needed, 201-202 

Investment, board of, see Boards; 
Commissioners; Management 

Investment of permanent common 
school funds: losses, 132, 142-144; 
problem of, 155-156; unlawful. Mo., 
323; mode and provisions. Ark., 216, 
218; Cal., 221, 222; Col., 226, 227; 
Conn., 23s, 236, 438; Del., 238, 239; 
Fla., 242, 243; Ga., 248, 249; Id., 
251; Ind., 266; la., 268; Kan., 273- 
274; Me., 295; Md., 296; Mass., 
299, 302, 308, 309; Minn., 319; Mo., 
322, 323; Miss., 326, 327; Mont., 
329; Neb., 332, 333; Nev., 335; 
N. J., 343; N. Y., 352, 353, 356; 
N. C, 362; N. Dak., 365; Ore., 380; 
R. I., 387, 388; S. Dak., 391; Tex., 
400, 405; Utah, 406, 407; Vt., 411, 
417; Va., 420; W. Va., 426; Wis., 
429; Wyo., 434; see also Bank stock; 
Boards; Bonds; Commissioners; 
Loans; Losses; Management; Mort- 
gages; Notes; Securities 

Iowa 

lands, school: internal improvement, 
62, 269; owned by state, 113, 115; 
sales, disastrous, 129; price of, 
139; rent of, 268; unsold, 268; 
section sixteen, 269 
Permanent School Fund, 113, 115, 
129, 130, 139, 142, 159, 268-270; 
see also Credit funds, 8; Teachers' 
Fund, defined, 268 
rate bills abolished, 27 
receipts for common schools, IQ05, 

268 _ _ 
supervision of schools, 197 

Islands, sand, sale proceeds devoted 
to common school fund. Ore., 381 

James I, 33, 41 

Janitor, services, 174, 292, 310 
JefiEerson College, Ala., lands, 209 
Jefferson, Thomas, plan for governing 
northwest, 44 



Kansas 
constitutional ordinance, quoted, 67 
free schools, 3 

funds for schools: Common School 
Fund, current revenue, 9; State 
Permanent School Fund, 62, 127, 
138, 143, 148, 159, 271-274; grants 
for schools, per centum (five), 
67, 68, 272, 273; see also Laxids 
lands for schools, internal improve- 
ment, 61-62, 148, 272, 273; re- 
valuation, 127; price, 138-139; 
sales, disastrous, 138-139; sections 
16 and 36, 271, 272, 273 
Kentucky 

Act for burning school fund bonds 

quoted, 152-153 
free schools, 278 

funds for schools: diverted, 152-154 
Common School Fund, consti- 
tutional provision for, 276 
Literary Fund, 102, 152-153, 159, 

275, 276 
Permanent School Fund, 7, 102, 
152, 153, 154, 275-278; see also 
above Literary Fund 
Surplus Revenue Loan Fund 
of 1837, 73, 76, 159, 276 

Lancasterian schools, D. C, 242 
Land boards, see under Boards 
Land cession by states, sought by Con- 
gress, 42; terms, 42; granted, 43; 
Ala., Ga., Miss., 208, 209; Tenn., 394 
Land claim controversy between nation 

and states, 40-43, 55-56, 229-230 
Land Commissioners, see Board of 
Land Commissioners; Commissioner 
Land Lottery Act, Ga., 248-249 
Land grants and reservations ^'' 

colonial, 34-36, 341; federal, origin, 39- 
42; see also below under Lands de- ■ 
voted to permanent common school ! 
funds: Federal grant policy; inter- j 
nal improvement; militarj'^; minis- ', 
terial; salt; Section sixteen; swamp; | 
university 
state, 81, Table XIV, 85, 100-106; 
Conn., 35-36, 43, 82; Ga., 36-37, 
82, 248-249; Me., 82-83, 85, 284- 
285, 288-289, 290, 291; Mass., 
36-37, 82, 83, 84, 85, 300, 301, 
302, 304, 305, 307, 308; N. H., 
84, 85, 340-341; N. J., 82; N. Y., 
36-37, 82, 350, 352, 353, 355; 
N. C, 82; Penna., 83, 384, 385; 
Tex., 84, 403; Va., 43 
Land Lottery Act, Ga., 248-249 



480 



INDEX 



Lands devoted to permanent common 

school funds 
agricultural lands, Nov., 236 
Back Bay, Mass., 304-305, 307-308, 

Table XLV, 452 
county, school lands, Ga., 4; Tex., 

401-402 
dried lake lands, La., 2S2 
Federal grant policy, evolution of, 35- 

37, 39, 42-55, 118, 371-372 
Federal grants quoted, see Congress- 
ional Acts quoted 
federal, not taxed, 67 
forfeited through exorbitant taxation, 

Wis., 430 
internal improvement, 60, 61-62, 66; 

Ark., 219; Cal., 222, 223; la., 62, 

269, 272, 273; Kan., 148, 272, 273; 

Nev., 336; Ore., 380, 381; Wis,. 430 
lake lands. La., 282 
military lands: Conn., 23; 111., Mo., 

314; Mich., 65; N. Y., 355; U. S. 

military reservation, 52, 369-372; 

Va. military reservation, 43, 52,' 

369-373 

ministerial lands, see Ministerial funds 
under Funds 

Railroad Land Grant, Tex., 403 

Riparian lands, proceeds of leases, 
increase permanent school fund, 
N. J., 344 . . 

reserved for religion, see Ministerial 
funds under Funds 

Salt Land Grant, Ohio, 51 ; devoted to 
permanent funds, 59; terms of, 
Ind., 59-60; states receiving, 59, 
66; area, 66; salt lands: Ark., 219; 
Ind., 262-263; Mo., 59, 322; Neb., 
33; Ohio, 373, 374 

Section Sixteen, evolution of grant, 
44-53", grants in lieu of, 52,^ 53; 
Ohio, 372-373; Okla., 379; states 
not receiving, 56, Table, 57; states 
receiving and area. Table XI, 57; 
ownership, 107, 108-114; states' 
grants: Ala., 208; Ark., 216, 217; 
Fla., 244; 111., 255; Ind., 260-261; 
la., 269; La., 279, 280, 281, 282; 
Mich., 313, 314; Mo., 313-314; 
Miss., 326, 327; Ohio, 371, 373; 
Tenn., 394-395, 39^; Wis., 430; see 
also Sections Sixteen and Thirty- 
six; Survey 

Sections Sixteen and Thirty-six, first 
granted, 54; states receiving and 
area, Table XI, 58; Ariz., 214; Cal., 
SS; Col., 226; Id., 252; Kan., 272; 
Minn., 317; Mont., 329; Neb., 332; 



Nev., 336; N. Mex., 347-348; N. 
Dak., 366; Okla., 379; Ore., 55, 380, 
381; S. Dak., 392; Utah, 407; 
Wash., 424; Wyo., 435; see also 
Section Sixteen; SiKvey 
selection of school sections, Nev., 
policy, 118, 336; see also under Survey 
seminary, see University lands 
swamp lands: granted, quoted, 62- 
63; used for schools, 63-65; di- 
verted, Ind., 145-146; devoted to 
permanent school funds: Ark., 
219; 111., 256; Ind., 145-146, 265; 
Mich., 313, 314; Minn., 316, 317, 
318; Mo., 322; N. C, 82, 361, 
. 362, 363; Ohio, 373; Ore., 381 
tide lands, sales' proceeds, increase 
permanent school funds. Ore., 381 
town lands, Conn., Mass., N. Y., 
Penna., 34-37; Me., 82, 83; Vt., 
409 
unappropriated land, W. Va., 427 
university lands, origin, 44, 46, 47, 
50; in Fla., Minn., Ohio,' Utah and 
Wis., 50; Ala., 209; Ark., 65, 217; 
N. H., 340; Okla., 379; Tex., 403 
imsold school lands: area and value, 
foot-note 43, 13-14, 15-16, 21-22; 
Ala., 211; Ariz., 214; Cal., 221; Col., 
226; Fla., 243; Id., 251; 111., 257; 
Ind., 260; la., 268; Kan., 271; La., 
281; Minn., 316; Miss., 326; Mont., 
329; Neb., 332; Nev., 335; N. J., 
342; N. Mex., 347-348; N. Y., 
350; N. C, 361; N. Dak., 365, 
366; Ohio, 376; Okla., 378, 379; 
Ore., 380; S. Dak., 391; Tex., 
400; Utah, 406; Vt., 408, 409; 
Wash., 423; Wis., 429; Wyo., 434 
waste lands, W. Va., 427 
see also Lease; Losses; Ownership; 
Price; Rent; Sale; Valuation 
Lawful uses, see Uses 
Lease of school lands, policy of: Col., 
226; Fla., 243; Id., 251; Kan., 143, 
271; La., 282; Miss., 109, 143, 326, 
327; Mont., 330; N. Mex., 347-348; 
Ohio, 373, 376; Okla., 378; S. Dak., 
391; Tenn., 243, 396; Wyo., 434; see 
also Rent 
Leased and unleased school lands, 
area, value, in U. S., Table VI, 21-22; 
see also Condition of permanent 
common school funds 
Legislation, incomplete, ineffectual, in- 
suflBcient, 92-93, 146-147, 163-164, 
244, 246, 264, 265, 421, 432 
Legislature, relation to management 



"Ss 



INDEX 



481 



of permanent school funds: Ala., 

212; Conn., 235; Ky., 277; Me., 289; 

Miss., 315; Neb., 333; N. J., 343 
Length of school year, see Term length 
Library books, a lawful expenditure of 

school moneys: Cal., 225; la., 270; 

Mass., 310; N. Y., 356; Ore., 382; 

Wis., 433 
Library moneys, penalty for diverting, 

_N. Y., 360 
Licenses, see under Fish; Gambling; 

Liquor; Marriage; Peddlers; Tavern 
Lieutenant-Governor, trustee of Per- 
manent School Fund, Vt., 415 
Limited principal, Mass., 300, 302, 

303, 304, 308; W. Va., 426 
Liquor license proceeds added to 

permanent school funds, Del., 240; 

N. C., 86, 362; S. C., 390; to current 

school revenue. Conn., 31; Minn., 

32; Ga., 247-248 
Loan, federal, see Surplus Revenue 

of 1837 under Funds 
Loans, see Debts, states'; Mortgages 
Loans as investments: Ark., 142-218; 

Conn., 142, 236; Ind., 263, 266; 

la., 148, 269; Neb., 142-143; N. H., 

339; N. Y., 142, 356; N. C, 362; 

Ore., 381; S. Dak., 391; Tenn., 398; 

Wis., 429 
London Company, Va., school endow- 
ment, 33; land grant, 40 
Long Island, claimed by Connecticut, 

229 
Losses to permanent school funds, 11- 
12, 116-117; uncertain and un- 
known, 130, 202, 322, 358; under 
town management, 131,322; causes, 
133; tabulated, 157-158, Table XX, 
323; under county management, 
133-137; under state management, 

138-159 
in the states: 158-159; Ala., 208, 210- 
211; Ark., 218-219; Cal., 222-223; 
Col., 227; Conn., 235-236; Fla., 
244; Ga., 249-250; Ind., 264-265; 
la., 129-130, 268, 269, 270; Kan., 
272-273; Ky., 276-277; La., 131, 
ISO, 151, 154, 159, 281, 282; Me., 
285-286; Md., 159, 297; Mass., 304, 
30s, 307-308; Mich., 312, 314; Mo., 
116-117, 129, 133-138, 159, 322-323; 
Miss., 159, 327; Neb., 146, 159, 333; 
Nev., 146, 159, 336-337; N. H., 340; 
N. Y., 122, 129, 358; N. C, 363; 
Ohio, 129, 375-376; Ore., 381-382; 
Penna., 383; Tenn., 398-399; Tex., 
i 1130, 404; Vt., 414, 415; Va., 420; 



W. Va., 428; Wis., 129, 430-433; 
Wyo., 435; see also Bank failures; 
Civil War, disastrous effects; Credit 
funds; Debts; Dishonesty; Diver- 
sion; Embezzlement; Investment; 
Loans; Management, township, 
loss; Misappropriations; Sale; 
Taxation, exorbitant 
Lotteries as source of school revenue, 

32-33; D. C, 32-33, 242; N. Y., 32, 

352; R. L, 32, 387 
Lottery Land Act, Ga., 248 
Louisiana 

appropriations for schools, i8ig, 24 

funds 
Free School Fund, 7, 8, 131, 150- 

151, 279-282 
Surplus Revenue Fund, 72, 76 

grants for schools, per centum, 280 

lands for schools, section sixteen, 
279, 280, 281, 282; dried lake 
lands, 282 

township losses, management, 131 

McEwen, Robert, Tenn. School Supt., 

embezzler, 145, 398 
Mail, transported free, 60 
Maine 

census, school, i8^i-ipo2, Table, 448 

expenditure, school, per child, i8^i- 
ig02, Table, 448 

free schools, 3, 284 

funds devoted to schools: permanent 
local funds, income from, i8ji- 
igo2, Table, 448; see also Township 
funds under Funds; Permanent 
School Fund, 7, 22, 131, 169, 171- 
172, 194-196, 283-295; Table, in- 
crease, 1551-/902, 446; total income, 
per child, relation to other sources 
of school revenue. Table, 1851-IQ02, 
448 

School Mill Fund, 291, 294-295; 1851- 
igo2, Table, 448 

State School Fund, see Permanent 
School Fund 

Surplus Revenue Fund, 1837, 73, 76, 
289, foot-note 

Town Funds, 131, 284-286 

grass sales' proceeds devoted to 
schools, 91 

lands, ministerial, 284-285; school, 
82, 83, 85, 284-286, 288-289, 290, 
291, 303; owned by Mass., 82, 83; 
rents, increase School Fund prin- 
cipal, 91; grants, 102; sale, 289 

support of schools prior to Permanent 
School Fund, 2S4-288 



482 



INDEX 



taxes devoted to schools, Building 
Tax, 30; local, compulsory, 1821, 
30, i68-i6g; rate, 1821-1S72, Table, 
446, i85i-igo2, Table, 448; Sav- 
ings Bank Tax, 287-288, 293, 
294; i8j3-i86g, Table, 447; 1831- 
ipo2, Table 448; town, 168, 
283, 284, 286, 291, 292; see also 
above Me., funds, School Mill 
Fund 

teachers' wages, 192-193; per month, 
1851-1^02, Table, 449 
Malpractice, fines for, increase per- 
manent school fund, 381 
Management of permanent common 
school funds, 107-128; see also 
Auditor; Boards; Commissioners; 
Controller; County Auditor; 
County Treasurer; Governor; Leg- 
islature; Merged funds; Ownership; 
Secretary of State; Superintendent 
of Public instruction; Treasurer 

history of, 107-114 

county, 107, 1 1 5-1 16, 117; defects, 
116-117; 111., 257; Ind., 116; Md., 
lis; Mo., 115, 116-117, 323; Miss., 
327; la., IIS, 270; S. Dak., iis, 392; 
Tex., IIS, 40°) 402, 405 

state: Ala., no, 212; Ark., 112, 219; 
Cal., 223; Id., 2S2; 111., no, 257; 
Ind., 114, 116, 266; la., 113, lis, 
269-270; Kan., 273-274; Ky., 27s- 
277; La., 282; Me., 29s; Md., iis; 
Mass., 308-309; Mich., 111-112, 
i2S; Minn., 113-114, 319, 320; 
Miss., 109, 327; Mo., IIS, 116-117, 
322, 323, 324; Mont., 330; Neb., 
333; Nev., 337; N. H., 339; N. J., 
344; N. Y., 121, 3SI, 354, 356, 357, 
358; N. C, N. Dak., 366; Ohio, 
108-109; Ore., 382; Penna., 38s; 
R. I., 388; S. C, 390; S. Dak., 
115, 392; Tenn., iio-iii, 397,399; 
Tex., IIS, 40O) 402, 405; Utah, 407; 
Vt., 416, 417, 418, 419; Va., 421; 
Wash., 424; W. Va., 428; Wis., 113, 
433; Wyo., 435 

state vs. township: advantages, 118- 
119, 202, 236; defects, 119, 121, 
122-124, 138-1S9, 203; efforts to 
improve, 124-127; evolution of, 107, 
109-114,117,118, 124-128; forms of, 
119-120, 121; losses under: N. Y., 
121-122, 138-1S9 

township, 107: change to state, 108- 
113; defects, 116,131-202; loss, Cal., 
222-223; 5ce (^l^o Losses; states em- 
ploying, 108, 281, 257,> 262 



Marriage license proceeds devoted to 
Public School Fund, Del., 238 

Maryland 

funds: Free School Fund, 6, 115, 
296-298; Surplus Revenue Fund, 

73, 76, 159, ?97 
lands: Virginia's claims, opposed, 
4I-S5; federal grant, sought, SS 
Mason, John, Grammar School be- 
quest, 34 
Massachusetts 
Articles of Separation, Me., 284, 303 
census, school, j5j7-jpo5. Table 

XLIV, 451 

expenditures, public school, total, 

i837-igo5, Table XLIV, 4S0; per 

child, 184S-190S, Table XLIV, 4S1 

free sciools, 161-162, 194, 300; see 

also Massachusetts, rate bills 
funds for schools 

Bounty Fund, 307; funds for min- 
istry and schools, 37; Literary 
Fimd, 301; School Fund, 6, 12, 22, 
90, 91-92, 169, 183-18S, 194-196, 
200, 299-311, 4SO-4S2; purpose, 
169; Surplus Revenue Fund of 
1S37, 73, 76, 308; town school 
funds, 34, 35, 37, 300, 308 
Institute of Technology, Mass., 

307 
land claims, 40, 42-43 
lands, Back Bay, 304-305, 307, 

308 
lands, ministerial, 37 
lands, school, reservations, colonial 

town, 34, 37; area, 102; in Maine, 

origin, 82, 83, 84, 85, 302; value, 

302, 303 
rate bills, 3, 27 
school age, 1837-1903, Table XLIV, 

450 
school support, earliest, 23 
Society of Natural History, Boston, 

307 
tax, school, local, colonial, 29, 176; 

War Tax, 79, 89; compulsory, 169; 

rate, 176, 300, 311; local tax, 1837- 

1905, Table XLIV, 451 
teachers' wages, increase, 192-193; 

per month, 18 37-1905, Table XLIV, 

451 
Maumee lands, Ohio, 370 
Merged funds, 202; Ala., 114; Ark., 

112, 114, 218; Col., 222; Fla., 4, 112- 

113, 114, 244; 111., 2Ss; Ind., 114, 
261-262, 442; Miss., 114; N. Y., 
357; Tenn., 86, no, in, 114, 397; 
Vt., 413, 416, 417, 418 



INDEX 



4% 



Mexican County School Land Grant, 

401 
Mexican state of Coahuila, 401 
Mexican state of Texas, 401 
Michigan 

constitution, quoted, 125 
funds for schools: 
accounts, 7, 112 
constitutional provisions, quoted, 

Five Per Cent Fund, see Michigan, 
Swamp Land or Five Per cent 
Fund 
Primary Seven Per Cent or Six- 
teenth Section School Fund, 
7, III, 112, 125, 312, 315 
Seven Per Cent Fund, see Primary 

Seven Per Cent Fund 
Sixteenth Section Fund, see Prim- 
ary Seven Per Cent Fund 
Swamp Land or Five Per cent 
Fund, 7,312,313,314,31s 
lands for schools 

ownership, state, 111-114 

price, minimum of school lands, 

127, 139, 314 _ 
sale of school policy, 139, 314 
Section Sixteen lands: manage- 
ment, 111-112; grant quoted, 
112; price, 127, 139, 314; origin, 
313; unsold, 313 
swamp lands, 63; origin, 65, 314; 
unsold, 313 
Military exemption moneys, 323; Ind., 
262; Mo., 323; Ore., 381; W. Va., 
427; Wis., 430 
Military fines, 323; support county 

seminaries, 87-88 
Military taxes, Ga., 247 
Minerals, sales of, proceeds, increase 
permanent school fund, Utah, 407; 
Wash., 424; see also Ore lands; Ore 
proceeds and royalties 
Ministerial taxes. Conn., 233 
Minnesota 
building tax, 30 

fines, criminal, support schools, 32 
funds for schools 
Permanent School Fund, s, 11, 
12, 91, 113-114, 126-127, 181- 
182, 316-320 
Swamp Land Fund, 102, 316, 317- 
318 
lands for schools 

ore lands, foot-note 43, 13-14, 91 

price, 139 

sale, 126-127, 139 

Sections 16 and 36, value, foot- 



note 43, 13-14, 55, 113-114, 
316, 317 
swamp lands, 64-66, 317, 318 
timber lands, foot-note 43, 13-14 
liquor license fees, 32 
territorial support of schools, 30, 
32 
Misappropriations of school funds, 
147, 153, 154; ^^^ f^^^o Auction; Civil 
War, disastrous results; Diversion; 
Losses 
Mismanagement of school funds, 119; 
N. Y., 121; see also Losses; Manage- 
ment 
Mississippi 
bank failures, 144, 327 
funds for schools: 

Chickasaw Fund, 109, 159, 325- 

328 
Chocktaw Fund, see Sixteenth 

Section Fund 
Common School Fund, 64; losses, 

131; see also Literary Fund 
Literary Fund, for charity schools, 
162; see also Sixteenth Section 
Fund 
Sixteenth Section Fund, 109, 143, 

325, 326, 327, 328 
Surplus Revenue Fund of 1837, 
72, 76 
lands for schools: 

sales' records lost, 131- 132 
sixteenth section lands, sale, lease 

and rent, 109, 143 
swamp lands, 63, 64 
notes unpaid, 143 
rents unpaid, 143 
Mississippi territory, 208, 209 
Missouri 

fines and forfeitures, 88 
funds for schools 

County Public School Fund, 63, 

116, 117, 129, 323, 324 
Permanent Common School Funds, 
5, IIS, 116-117, 129, 133-138, 

141, 143, 321-324 
Special District Fund, 324 
State Public School Fimd, 323, 

324 
Surplus Revenue Fund of 1837, 

72, 76, 322 
Township School Fund, 133-138, 

145, IS9, 323-324 
school grants, per centum, 68, 69 
school lands 

lost, 141 

military, 314 

salt area, 322 



484 



INDEX 



sixteenth section lands, 322 
swamp lands, 63, 322, 323 
Monastic funds, 33 

Moneys for schools, see under Bequests; 
Expenditures; Funds; Gifts; Lot- 
teries; Receipts; Support of schools; 
Tax 
Montana 
funds 
Public School Fund, 91, 329-331 
State School Fund, see Public 
School Fund 
school lands, sections sixteen and 
thirty-six, 102, 329, 330 
Mortgages, farm, as securities, Id., 
25, 251; Ind., unpaid, 142; Ind., 
poor investment, 264; la., 268, 270; 
N. Y., forged, 358; N. Dak., 365; 
S. Dak., 391; Utah, 406 

Names, see Funds; Title 
National, see Federal 
Nebraska 

funds for schools 

Common School Fund, current 

revenue, 9 
constitutional provisions, 127, 332, 

.333 
Five Per Centum Fimd, 333 
Permanent School Fund, 159, 332- 

334 
school grants: federal lands, area, 

103; per centum, 333 
school lands 

rents distributed, 91; price, mini- 
mum, 127-128, 333 
saline lands, 59, 333 
sections sixteen and thirty-sLx, 
332 
Nevada 

funds for schools 

Permanent School Fund, im- 
portance, 22 
State School Fund, 335-337 
school lands: internal improvement, 
62; in lieu of section lands, iiS, 336 
New Connecticut, sec Connecticut; 

Western Reserve 
New England Company, Conn., plans 

for northwest, 43, 45 
New Hampshire 
Bank taxes, 340 
Maryland resolutions endorsed by 

N. H., SS 
school funds 

Common School Fund, 11, 228, 
338, 340-341; see also Institute 
Fund 



Institute Fund, 84, 103, 159, 338- 

.341 
Literary Fimd, 339, 340 
Surplus Revenue Fumd of 1837, 73, 
76, 339-340 
school lands, 55, 84, 85, 340, 341 
taxes. Bank Tax, 340 
New Haven: rate bills, 26; permanent 

school funds, 34, 35 
New Jersey 
school funds 

apportionment, 183 

Permanent School Fimd, 88, 183, 

199, 342-346 
School Fund, see Permanent School 

Fund 
State School Fund, see Permanent 

School Fund 
Surplus Revenue Fund, 76 
school lands: land granted to Conn., 
229; riparian, 82,85; rents, reserved, 

91 
tax devoted to School Fund, 90 
New London, Grammar School Grant, 

35 
New Mexico 
Five Per centum Grant, 69, 347 
school funds, 6g, 347-348 
school lands: sections 16 and 36, 

347, 348 
New York 

appropriations, iygj-1800, 24 
funds 
Common School Fund, 168, 171, 
180, 195-196, 198, 228, 349-360, 

453-455 
Educational Fund, defined, 357 
Literature Fund, 349, 350-351, 354, 

357, 358-359 
local income, 1831-igoo, Table 

XLVI, 455 
ministerial and school funds, 36 
town school funds, 36, 37 
United States Deposit or Surplus 

Revenue Fund, 6, 72, 77, 121- 

122, 132, 142, 159, 349, 354, 355, 

356,357,358,455 
land claims in Northwest, 40, 42-43, 

229 
lands for ministry and schools, 36- 

37, 350 
lands for schools, 82, 85, 350, 352-353; 

see also Town school funds 
lotteries, 32, 352 
rate bills, 3, 27, 350, 455^ 
support of schools, earliest sources, 

23 
taxes, school: compulsory, 1795, 30, 



INDEX 



485 



164; Table, 1831-igoo, local, volun- 
tary, state, 455 
teachers' wages, 192-193; average 
per month, total cost, iSji-ipoo, 
Table, 455 
Normal departments and schools sup- 
ported by permanent school funds, 
Mass., 173, 192, 301; N. Y., 351; 
Minn., 318; Va., 422; Wis., 192, 433 
North Carolina 

land claims of, in southwest, 40 
land cession, area, 53 
land, swamp, 82, 85, 361-362, 363 
State Literary Fund, 88, 144, 151- 

152, 154, 159, 198, 361-364 
Surplus Revenue Fund, 72, 77 
North Dakota 

constitutional provisions for school 

funds, 128, 366 
funds: Five Per Cent Fund, 68, 366; 
Permanent School Fund, 182, 183, 
365-367; Tuition Fund, defined, 

365 
lands: rents, 91; sections 16 and 36; 

365, 366 
Northwest Territory, conflicting claims 
to, 40-42; ceded by states, 42, 43, 371; 
church and school reservations, 45- 
53, 57-58, 369; military reservations, 
Va., 370; U. S., 371, 372; ordinances 
for governing, 44-47; sale, 44-45, 
46, 47-49) 369-373; settlement, 43- 
47; siurvey, methods of, 44-45, 48, 

49, 371, 372 
Notes, unpaid or worthless: Ala., 143; 
Ark., 142, 218; Miss., 143, 326, 327; 
Mo., 143, 323; Tenn., 398; see also 
Securities, poor 

Objects, see Uses 

Ohio, claimed by eastern states, 40-42 

Ohio Company, 45, 46, 47 

Ohio Enabling Act quoted, 108 

Ohio 

school funds 

Common School Fund, defined, 9, 

368 
Irreducible State Debt, 7, 108-109, 

159, 368-377 

Surplus Revenue Fund, 77, 374-375 

school grants: moneys, 51, 67, 68, 

76; lands, 51-53, 371-372; lands 

for religion and schools, 46, 47, 

48, 51, 52, 369-372; Moravian 

Grant, 369, 370, 372; see also 

Northwest Territory 

school lands: ownership, 108-109; 

sale, 45-47, 82, 10S-109, 129; 



purchase, 369, 370, 371, 372; salt 
lands, 59, 60; section sixteen, 51-53, 
373; swamp lands, 63; see also 
Northwest Territory 
Oil fees for schools, Ga., 247, 248 
Oklahoma 

organic act, 378, 379 
Permanent Common School Fund, 80, 
378-379; see also Indian Territory- 
Ordinance of 178s, 44-45 
Ordinance of 1787, 46-50 
Ore lands, value, Minn., foot-note 43, 

13-14 

Ore proceeds and royalties added to 
principal, Minn., 91; Utah., 407; 
Wash., 424 

Oregon 

Common School Fund, 6, 126, 380- 

382 
Enabling Act, quoted, 54 
school grants, sections, 54, 55 
school lands: for internal improve- 
ment, 62; swalnp lands, 63; sec- 
tions 16 and 36, 54, 55, 380 
Territorial Government Act quoted, 54 

Organization, influenced by permanent 
funds, 194-196; see also Free Schools; 
Returns; Supervision 

Origin of Permanent Common School 
Funds, 33-37, 39-106; Ala., 208-210; 
Ariz., 214; Ark., 217; Cal., 222; Col., 
226-227; Conn., 229-234; Del., 239; 
Fla., 243-244; Ga., 248-249; Id., 252; 
111., 255-256; Ind. Ter., 259; Ind., 
260-263; la-, 269; Kan., 272; Ky., 
275-276; La., 280-281; Me., 284- 
285, 288-289, 290-291; Md., 296, 297; 
Mass., 301-303; Mich., 313-314; 
Minn., 317-318; Mo., 321-322; Miss., 
325-327; Mont., 329-330; Neb., 332- 
333; Nev., 336; N. H., 340-341; 
N. J., 342-343; N. Mex., 347; N. Y., 
350-351, 355; N. C, 363; N. Dak., 
366; Ohio, 370-373; Okla., 378-379; 
Ore., 380; Penn., 384-386; R. I., 
387-388; S. C, 389-390; S. Dak., 
392; Tenn., 394-397; Tex., 400-404; 
Utah, 407; Vt., 410, 411, 412-413, 
416; Va., 420; Wash., 424; W. Va., 
420, 421, 427; Wis., 430; Wyo., 435; 
see also Creation; Evolution; Fed- 
eral lands, grants; Federal money 
grants; Grants, state moneys; Land 
grants and reservations, state 

Orphan asylum aided by swamp lands. 
Minn., 318 

Ownership 
state, Tenn., iio-iii; Mich., 111-114 



4S6 



INDEX 



state versus township, 107, 113-114, 

373 
township and state management, 
Ala., 109; 111., iio-iii; La., 281, 
282; Mass., 109; Ohio, 108-109; 
see also Land claim controversy; 
Management 
Oyster lands' rents, Ga., 247, 248 

Panic of 1837, 314 

Parishes, La., 282 

Participation in permanent common 
school funds: optional. Conn., 166; 
Me., 291; N. Y., 164-165; conditions, 
177-179, 189-190; Ala., 212; Ark., 
220; Cal., 225; Col., 227; Conn., 237; 
Del., 241; Fla., 245; Id., 253, note 
122a, 111., 257-258; Ind., 267; la., 
270; Kan., 274; Ky., 278; Me., 291- 
292; Mass., 310-311; Mich., 315; 
Minn., 320; Mo., 324; Mont., 331; 
Neb., 334; Nev., 337; N. J., 345-346; 
N. Y., 360; N. Dak., 367; Ore., 382; 
R. I., 388; Utah, 407; Vt., 411, 412, 
415-416, 419; Va., 422; Wash., 425; 
W. Va., 428; Wis., 433; Wyo., 436 

Patterson, J. W., and N. H. Institute 
Fund, 341 

Payments, interest on, deferred, Nev., 
335 

Peasley, Hy., school bequest, 33-34 

Peddlers' licenses, Vt., 409 

Penal fines, see Fines 

Pennsylvania 
charter, 229 

funds for schools: Common School 
Fund, 10, 159, 383-386; Surplus 
Revenue Fund, 77, 386 
land claims, conflict with Conn., 

229, 230 
lands, reserved for schools, 83, 85, 

384, 38s 
rate bills, 3, 26, 27 
school support, 77, 159 
Schools: free, 26; private, 26, 83 

Per cent of total common school 
revenue derived from permanent 
school funds and lands. Tables IV, 
13-14; VI, 17-18; VII, 21-22; see also 
Importance; Income Tables 

Per cent paid on school fund loans, 
Table VII, 20-21 

Per centum grants, see under Federal 
money grants; Funds; Grants 

Per centum moneys lost, 219 

Physiology and hygiene, penalty for 
not teaching, Minn., 320; N. Y., 360 

Pickering, Col. Timothy, see New 



England Company; Ohio Com- 
pany 

Plantations, Me., unit of apportion- 
ment, 287, 293, and note 

Planters' Bank of Mississippi, 326, 327 

Plymouth Colony: colonial school tax, 
29; license fees, 16^3, devoted to 
schools, 31; claims to western lands, 
40; charter, 229 

Poll Tax, see under Tax 

Poor children educated by town, Conn. 
Colony, 25; books for, Va., 422 

Poor funds devoted to common schools, 
N. Y., 351; 5-ee also under Funds 

Population, see Census 

Pottawattomie Indians, lands pur- 
chased, 266 

President, Board of Land Commission- 
ers, relation to management of 
school funds, Mont., 330 

Price of federal lands, 47, 59 

Price of school lands, minimum: 
Ind., 59; la., 139; Mich., 127, 139, 
313; Minn., 139; Neb., 127-128; 
N. Dak., 128; S. Dak., 128, 391; 
Wash., 128 

Price of school lands: Cal., 131, 221; 
Fla., 243; Mich., 314; Mont., 330; 
Neb., 333; N. Mex., 348; N. C, 
362; Ohio, 129; S. Dak., 391; Tex., 
130, 138, 404; Vt., 409; Wash., 423; 
see also Lands, unsold school 
lands, area and value; Sale 

Primary school land grant, Republic 
of Tex., 401 

Principal of permanent common school 
funds: borrowed by states, see Loans; 
growth, see Increase; held by state, 
5; distributed locally, 5; value, in- 
equaUty of, 11; losses in twelve 
states, see Table III, 12; limited, 
12, 426; true value in all states, 
1905, 13-14, 20-21; estimated value, 
■Tpoj, 15-16; loans from to states. 

Table VII, 20-21; see also Condition; 
Credit funds; Debts; Increase; Loans; 
Losses; Management; Valuation; 

Prison supported by swamp lands, 
Minn., 318 

Private schools: number, Fla., Mass., 
162; public moneys, support, Fla., 
Ind., Tenn., 163; see also Academies 

Property, derelict, devoted to per- 
manent school funds, Va., 400, 421 

Public improvements, paid with 111. 
School Fund, 257 

Public land states, see Table XI, 57- 
58 



INDEX 



487 



Public lands, see Lands, federal, under 
Lands 

Public schools, see Free schools 

Purpose of permanent school funds: 
Conn., 165, 166, 228; Ga., 162; Me., 
169, 288, 289, 292; Mass., 169, 300, 
301; Miss., 162; N. Y., 168, 353; 
Vt., 170, 412; Va., 162; see also Kvms; 
Influence; Uses 

Purpose thwarted, 155, 157; see also 
Credit funds; Debts 

Putnam, Rufus, promoters, land com- 
panies, 43, 45 

Quit rents, N. Y., 351, 355 

Railroad taxes, not collected, Ind., 264; 
dividends devoted to schools, Ga., 247, 
248; land grant, Tex., 403; stock as 
security, Md., 296, 297; securities 
devoted to permanent common school 
funds, Mass., 303, 305, 306-307 
Ramsey, Alexander, governor of Minn., 

on sale policies, 139 
Rate bills, 3, 25-28, 164; Conn., 168; 
Mass., 300; N. Y., 350; R. I., 28; 
Tables: VIII, year abolished, 27; 
JX, Conn., 1856-1S68, 28; XLVIII, 
N. J., 1831-1867, 455; see also Free 
schools 
Real estate devoted to permanent 
common school fund, N. J., 343; see 
also Bequests; Intestate estates; 
Lands 
Receipts for Common Schools 

in U. S., 1905: Table VI, per cent 
divided from permanent funds, lo- 
cal tax, state tax, Table VII, to- 
tal from all sources, total from 
funds and rents, 20-21 
sources and proceeds: Conn., 1825- 
1895, Tables XXVII, 439; XXVIII, 
440; Fla., 1870-1905, XXX, 441; 
Ind., 1866-1906, XXXVII, 445; 
1855-1885, XXXVIII, 445; Me., 
1851-1902, Table XLII, 448; Mass., 
18 35-1 90 5, Table XLIV, 450-451; 
N. Y., 183, 18 31-1900, Table 
XL VII, 455; see also Condition of 
permanent common school funds 
Receiver-general, relation to school 

funds, Mass., 309 
Records, lost, see Title 
Regents, N. Y., control Literature 

Fund, 351 
Religion funds and lands for, see Funds, 

ministerial 
Religious and sectarian schools: de- 



barred from public moneys, Kan., 
274; supported with public moneys. 
Conn., 233; Ind., 162-163, 274; Minn., 
320 

Religious instruction forbidden, Mont., 
331; Nev., 337 

Rent of school house, a lawful ex- 
penditure, Mont., 331 

Rent of school lands 
proceeds, 1905, Table VII, 20-21 
uses, Tenn., 11 1 

added to principal: Cal., 223; Me., 
91; Minn., 91, 316-317, 319; N. 

.J-, 91 

distributed annually: Col., 226; Fla., 
243; Ga., 247; La., 280; Mont., 
329; Neb., 332; N. Mex., 348; 
N. Dak., 366; Ohio, 109, 368; 
Okla., 378; S. Dak., 392; Tenn., 
hi; Tex., 401; Utah, 406; Wash., 
Wyo., 434 
income from, 1905: Ariz., 214; Ga., 
248; La., 279; Mont., 329; Neb., 
332; N. Mex., 348; N. Dak., 366; 
Okla., 378; S. Dak., 392; Tex., 
401; Utah, 406; Wash., 424; Wyo., 
434 
unpaid. Miss., 327; see also Quit 
rents; Lands, unsold school 
Repairs of school houses, a lawful ex- 
penditure of school funds: Miss., 
174, 328; Mont., 174, 331; N. C, 
174; an illegal use, Col., 227; Me., 

293 
Reports, see Returns 
Requirements, see Participation 
Resolutions quoted, Md., 41, 55; Mass., 

30s 
Returns or school reports 

importance of, 164, 196; Fla., Me., 
Mass., N. Y., 164, 194-195; in- 
obtainable required for school 
funds: Conn., 175, 237; 111., 258 
Ind., 267; Kan., 274; Me., 175 
194, 195-196, 291, 293-294; Mass. 
311; Minn., 320; Mo., 324; N. Y. 
175; N. Dak., 367; Ore., 380; Utah 
407; Wis., 433 
secured through influence of per- 
manent funds, 175, 194-196; Me., 
293-294 
Table XXV, N. Y., Mass., Me., 
1805-1885, 19S-196 
Revaluation of school lands, 13-14, 

foot-note 43; Kan., 127 
Revenue, see Appropriations; Income; 

Increase; Receipts; Support 
Rhode Island 



488 



INDEX 



funds for schools: Permanent School 
Fund, 32, 90, 153, 159, 388-389; 
Surplus Revenue Fimd, 77 

lands, claimed by Conn., 229 

rate bills, 27, 28 
River improvements paid with school 

moneys, Ky., 276 
River lands, see Riparian, under Lands 
Roads maintained by school moneys, 

Ky., 276 
Royalties, see Ore 
Rupee Grant, Ohio, 370 

Salary, see Teachers' wages 
Sale of school lands 

in states: Ala., 211; Ariz., 214; Ark., 
217; Conn., 231; Fla., 244; Ind., 
261, 262-263; Me., 288, 289, 290, 
295; Mass., 302; Minn., 139; Mo., 
322; Miss., 326, 327; N. Y., 350, 
351. 353, 355; Ohio, 373, 374; 
Tenn., 396; Wis., 139 
methods and policies: contracts,46-48, 
335; steps in, 93, 95; Ohio, 108-109; 
Miss., 109; Ala., no; Tenn., Mich., 
Ark., Fla., 110-112; unbusinesslike 
and wasteful, Kan., 123, 138, 140, 
141; directed by constitutions, 124, 
128; lax and careless, Ala., La., 
Miss., 131-132; policies compared, 
la., Mich., Minn., Wis., 139; pro- 
ceeds diverted, Ind., 145-146; tax 
sales, Ind., 265; 

see also Lease; Payments; Per 

Centum Fund under Funds; Price; 

Rent; Unsold common school 

lands 

Salt fines support seminaries, Ind., 262 

Sanitary requirements for sharing in 

school funds. Conn., Del., Fla., N. J., 

Va., 198-199, 241, 246, 341 

Savings Bank Tax, Me., 288, 294; 

N. H., 339 
School children, see Apportionment; 

Census; Poor children 
School house, erection, a lawful ex- 
penditure, Fla., 241; Miss., 174, 328; 
Mont., 174; an illegal expenditure, 
Ark., 220; Col., 227; Kan., 274; 
Me., 293; Nev., 337; Ore., 382; see 
also Rent; Repairs 
School, legal, defined, Vt., 415 
School lots, see Local and town mider 

Funds and Town under Lands 
School societies, Conn., 166, 175 
School year, see Term 
Secondary schools, see Academies; 
Funds 



Secretary, Board of Education, a com- 
missioner of permanent common 
school funds, Mass., 309 

Secretary, Board of Land Commission- 
ers, relation to management of Per- 
manent School Fund, Mont., 330 

Secretary of State, aids in managing 
school funds: Ark., 219; Kan., 273; 
Mass., 309; Neb., 333; N. J., 344; 
N. Dak., 366; Ore., 382; Tex., 405; 
Utah, 407; Wash., 424; Wis., 433; 
Wyo., 435 

Sectarian, see Religious 

Securities of permanent cormnon school 
funds, 142-143; Ark., 216; Cal., 
241; Conn., 437, 438; Del., 238; 
Fla., 243, 244; Id., 251; la., 268, 269; 
Ky., 275, 276; La., 279; Md., 296; 
Mass., 300, 303, 305; Mmn., 316; 
Mont., 329; Neb., 332; Nev., 335; 
N. J., 343; N. Y., 353, 356; N. Dak., 
365; Ore., 380; R. L, 387; S. Dak., 
391; Tex., 400; Utah, 406; Vt., 415, 
416, 417; Va., 420; W. Va., 426; 
Wis., 429, 431; Wyo., 434 

Securities, poor, unsafe, worthless: Ark., 
218; Col., 227; Conn., 235; la., 268; 
Kan., 273; Mo., 323; Miss., 327; N. 
Y., 358; Ore., 381-382; Tenn., 398; 
Tex., 404; Wis., 430; see also Bank 
stock; Bonds; Loans; Losses; Mort- 
gages 

Shannon, R. D., Mo., Superintendent, 
investigates losses, 133-138, 323 

Show tax, devoted to schools, 247, 248 

Simons, Benjamin, Free School Fund, 

33. 

Soldiers, free transportation, 60 

Soldiers, see also under Fund, Bounty 
Funds and under Lands, Military 

Sources of permanent common school 
funds, classified, 39; unproductive, 
92; see also Increase, sources of; 
Origin 

South Carolina 

claims to lands in Southwest, 40 
Permanent School Fund, 11, 389, 390 
Surplus Revenue Fund, 72, 78 

South Dakota 

Permanent School Fund, 6, 19, 115, 

120, 391-393 
Sixteenth and thirty-sixth section 
school lands, 128, 392 

Southall, J. W., Supt. Va., quoted on 
fines, 148 

Spain, land claims of, 40 

Special Superintendent, paid from Per- 
manent School Fund, N. J., 345 



INDEX 



489 



Squatters on school lands, Ala., 211; 

Tenn., 395 
State aid to public schools, 81-97, 

100-106 
State lot, Me., 285; N. Y., 36, 37, 350, 

351 
State moneys, see Grants, state moneys 
State school lands and land grants, 
see Land grants and reservations, 
state 
State sources of common school funds, 
see Grants, state moneys; Land 
grants and reservations, state 
State Superintendent, see Superin- 
tendent of Public Instruction 
States possessing no funds, 10 
Stationery, a lawful expenditure, Ind., 

298 
Stone, sale proceeds added to school 
fund, Mont., 330; Utah, 407; Wash., 
424 
Sundries purchased with school fund 

income, Mass., 310 
Superintendent of Public Instruction 
aids in managing school funds, 115; 
Ark., 219; la., 270; Kan., 273; 
Mich., 315; Mont., 330; N. Dak., 
366; Vt., 415; Va., 421; Wash., 
424; W. Va., 428; Wyo., 435 
apportions school moneys, Ala., 212; 
Ark., 220; Cal., 224; Col., 227; 
Fla., 245; Id., 252; Ind., 266; Kan., 
274; La., 2S2; Mich., 315; Minn., 
Mo., 324; Mont., 330 
office created, Cal., 197; Fla., 197; 
Me., 196-197; Mich., 197; Wis., 197 
salary, a lawful expenditure: N. J., 
345; Mass., 310; Va.,422_ 
see also County Superintendent; 
Special Superintendent 
Supervision, 194; influenced by per- 
manent funds, Cal., Conn., Fla., 
la., Mich., Wis., 196-197 
Support defined, Mass., 310; not de- 
fined, N. J., 345 
Support of schools, earliest, 23-38; 
uncertain, 164-165; see also Federal 
lands, grants; Federal money grants; 
Funds; Grants, state moneys; In- 
crease, sources of; Lands; Receipts, 
sources and proceeds; Taxation 
Supreme Court fees devoted to per- 
manent fund, N. Y., 355 
Survey, federal, origin, description, 
diagram; 48, 49; ordinances, quoted, 
44, no; incomplete, 57; Wash., 
423; state. Mo., 322 
Survey systems in Tenn., 54, iio-iii, 



395) 396; U. S. MiHtary Reservation, 
371-372; Va. MiHtary Reservation, 
371; Western Reserve, 371; Wyo. 
Valley, Ohio, 36 
Susquehanna Company, 36, 229, 230 
Symmes, John Cleve, purchase in 
Northwest Territory, 47, 52, 369, 
370,371,372 

Tables 

Table A, Growth of principal and 
income of Permanent Common 
School Funds, Conn., Fla., Ind., 
Me., Mass., N. Y., lygg-igos, 94 

Table I, Credit Funds (in sixteen 
states), principal, igo^, 8 

Table II, Official titles of Permanent 
Common School Fund, 10 

Table III, Lost principal in twelve 
states, 12 

Table IV, Permanent Common School 
Funds grouped in order of value; 
per cent of school revenue derived 
therefrom, 1905, 13-14 

Table V, Permanent Common School 
Funds in order of estimated value 
including unsold lands, 15, 16 

Table VI, Per cent of total common 
school revenue derived from per- 
manent funds, local tax and state 
tax, 17-18 

Table VII, Permanent Common 
School Funds for all states, 1905, 
credit fimds, debts, loans, rate of 
interest, .income, per cent of total 
receipts, total receipts, unsold 
school lands, area, value, 21-22 

Table VIII, Rate bills, year abolished 
in fourteen states, 27 

Table IX, Conn., school receipts 
and sources of revenue, 1856-1868, 
28 

Table X, States receiving no federal 
land grants, 57 

Table XI, Public land states and 
sixteenth and thirty-sixth section 
land grants, area and date, 57-58 

Table XII, Internal improvement, 
saline and swamp land grants, 
66 

Table XIII, U. S. Surplus Revenue 
Loan of 1837, states receiving, 
shares, quota devoted to schools, 
original use of principal, final dis- 
position or present condition, 74-78 

Table XIV, State Land Reservations, 
area, date, proceeds, 85 

Table XV, Ind. School Fund, com- 



490 



INDEX 



parison of proceeds of sources of 

increase, 1 868- 1 go 3, 87 
Table XVI, Creation of permanent 

common school funds, title, year, 

mode, year of states, admission 

into union, 98-99 
Table XVII, Titles and original 

capital of permanent common 

school funds arranged by states, 

100-106 
Table XVIII,Lossof Township School 

Funds, Mo., before 18^0, amounts, 

balance, causes, 133-138 
'i'able XIX, Summary of causes of 

loss to permanent school funds, 

157-158 
Table XX, Losses, amount, date, 

fund, credit funds and debts, 

158-159 
Table XXI, Objects to which revenue 
of public permanent common 
school fimds may be lawfully ap- 
plied in the several states, 173- 

174 

Table XXII, Conditions of partici- 
pation in the several states, 177-179 

Table XXIII, Bases of apportion- 
ment of income of permanent 
school funds, 186-188 

Table XXIV, Teachers' average 
monthly wages in N. Y., Mass., 
Ind., Me., Conn., i8ji-igoy, 192- 

193 

Table XXV, Returns in N. Y., 
Me., Mass., 1805-1S85, 195-196 

Table XXVI, Growth of principal 
and income of Conn. School Fund, 
ijgg-igos; securities, igoj, 437- 
438 

Table XXVII, Conn., total cost of 
public education, sources from 
which derived and relative im- 
portance, 439 

Table XXVIII, Conn, school sup- 
port, i82j-i8gs: amount per child 
derived from School Fund and from 
aU other sources, 440 

Table XXIX, Growth of teachers' 
wages in Conn., and relation to 
total school expenditure, 440 

Table XXX, Fla., State School Fund, 
growth, principal and income; 
relation of income to total expendi- 
ture, iSyo-igoj, 441 

Table XXXI, Ind. Common School 
Fimd, funds composing and amount 
each added, 442 

Table XXXII, Sotirces of increase 



of Ind. Common School Fund, pro- 
ductive and unproductive, 442 

Table XXXIII, Increase of Ind. 
Common School Fund from fines, 
forfeitures, and other sources, 443 

Table XXXIV, Growth of principal 
of Ind. Common School Fund,i55^- 
igo6, 443 

Table XXXV, Growth of income of 
Ind. Common School Fund, 186^- 
igo6, 444 

Table XXXVI, Average annual in- 
crease of principal of Ind. School 
Fund, i8s4-igo2, 444 

Table XXXVII, Comparison of Ind. 
school revenues from funds, local 
and state tax, 445 

Table XXXVIII, Growth of In- 
diana's endowed school system, 
1855-1885, 445 

Table XXXIX, Me. Permanent 
School Fimd, growth, principal and 
income, i8j8-igo6; total expendi- 
ture for schools, per cent from 
School Fund, i8j^-igo6, 446 

Table XL, Me. local school tax rate, 
446 

Table XLI, Bank tax, Me., 1833- 
i86g, 447 

Table XLII, Me., total public school 
expenditures. Permanent School 
Fund and other sources of school 
revenue, i8^i-igo2, 448 

Table XLIII, Me. teachers' wages 
per month, i8^i-igo2, 449 

Table XLIV, Mass. school support, 
summary, sources, proceeds, ex- 
penditures, i835-igo5, 450, 451 

Table XL V, Mass. School Fund, 
sources of growth, 18 35-1 8 37, 452 

Table XLVI, N. Y. Common School 
Fund, growth of principal and in- 
come, i8o6-igo5, 453, 454 

Table XLVII, N. Y. Common School 
Fund, showing total cost of public 
education, sources and proceeds, 
teachers' wages, 1831-igoo, 455 
Tavern license fees devoted to perma- 
nent fund, Del., 86, 238 
Tax: Bank, see Bank taxes; corpora- 
tion, Ind., uncollected, 147-148, 264; 

direct, 247, 248, 305; inheritance, 17; 

military tax and fines: used as annual 

school revenue, Ga., 247; Ind., 262; 

devoted to permanent funds. Mo., 

323; poll, for schools, 17, 18, 214, 245, 

247, 248; Ariz., 214; railroad, 17; 

sales, invalid, N. C, 361, 362J sav- 



INDEX 



491 



ings banks and trust companies, Me., 
i85i-igo2, Table XLII, 448; tea, 31; 
see also Animal, Bank, Corporation, 
Direct, Military and Show tax; and 
under Fund, Delinquent Tax Fund 
and Tables VI, IX, XVII, XVIII, 
XXVII, XXXVII, XL, XLI, XLII, 
XL VI, XLVII 

Taxation, colonial, 28-30; exorbitant, 
on school lands. Wis., 141, 430; fed- 
eral lands exempt, 127; influence by 
permanent common school funds, 3; 
Conn., Me., N. Y., 165-170; Mass., 
176-177; Fla., 198; La., 281; Mich., 
314; Nev., 337; N. H., 339; opposed, 
3-4, 164-165; discontinued. Conn., 
168, 228; per cent of expenditures 
paid from, Table VI, 17-19; permis- 
sive, compulsory, voluntary. Conn., 
Mass., Me., Minn., Ariz., 3-4, 28-31; 
N. Y., Ind., 164-165; Me., 284; Mass., 
300; principles, 3-4; proceeds devoted 
to Permanent School Fund, balances. 
Me., 291; N. J., 343; Tex., 402; rate, 
basis of apportionment, Mass., 310; 
required, Del., 241; Me., 292; Mass., 
311; N. Y., 352; R. L,_38S, 401; 
Wash., 425; territorial, Minn., Ariz., 
30-31, 215 

Teachers' board, lawful expenditure. 
Conn., 171; Me., 171-172, 293; N. Y., 
171; Table XXI, 173 

Teachers, colonial, 25, 26, 28 

Teachers' efficiency increased, 191 

Teachers' institutes permanent funds, 
N. H., 338 

Teachers must be certified and quali- 
fied to receive public moneys, 177, 
178, 191; Cal., 225; Conn., 237; Fla., 
246; 111., 258; Ky., 277; Me., 292; 
Mich., 31s; Minn., 320; Neb., 334; 
Nev., 337; N. Y., 360; Wash., 425; 
Wis., 433 

Teachers, number a basis for appor- 
tionment, Cal., 224; N. J., 344-345; 
N. Y., 358, 359 

Teachers' quota, N. Y., 359 

Teachers' training, 160; see also Insti- 
tute Fund under Fimds; Normal de- 
partments; Teachers' institutes 

Teachers' wages, colonial, 25, 26, 29; 
a lawful expenditure. Table XXI, 171- 
172, 173, 190-192; Ala., 212; Cal., 
225; Conn., 171, 236; Del., 241; la., 
270; Ind., 266; Ky., 277; Me., 171- 
172, 293; Md., 298; Mass., 193, 310; 
Mich., 193, 315; Minn., 320; Mo., 
324; Miss., 328; Neb. 334; Nev., 337; 



N. Y., 171, 356, 359; N. Dak., 366; 
Utah, 407; Va., 422; W. Va., 428; 
increase; see below, Tables; paid 
from rate bills, see Rate bills; taxa- 
tion for, 29-31, 160, 164; unconstitu- 
tional, 165; influenced by permanent 
common school funds, 171, 191, 192- 
193; Tables: XXIV, 192-193; XXIX, 
440; XLIII, 449; XLIV, 451; XLVII, 
455 
Tennessee 

free schools, indifference to, 163 
funds for schools 

Permanen:: School Fund, 9, 86-87, 
iio-iii, 114, 144, 151, 163, 172, 

394-399 
Surplus Revenue Fund, 78, 144, 

14s, 397 
grant, congressional land, quoted, 39 
lands devoted to schools: sixteenth 

section lands, 51, 53, 54, iio-iii 
private schools supported, 163 
school legislation, ineffective, 163- 

164 
survey system, iio-iii 

Term length: Conn., in 1700, 30; fixed 
for participation in school funds, 125, 
176; Ark., 220; Cal., 176, 178, 225; 
Col., 227; Conn., 167, 176, 178, 237; 
Fla., 178, 245; la., 270; Kan., 176, 
274; Ky., 178, 278; Me., 178, 292; 
Mass., 178; Mich., 125, 178, 315; 
Miim., 178, 320; Mo., 178, 324; 
Mont., 178, 331; Neb., 178, 334; 
Nev., 178, 337; N. J., 178, 345; 
N. Y., 176, 178, 360; Ore., 178, 
382; Utah, 178; Va., 178; Vt., 4ro, 
415; Wash., 178, 425; W. Va., 428; 
Wis., 433; Wyo., 178, 436; increased 
by permanent common school funds, 
167, 176 

Territorial school fimd, Ariz., see under 
Funds 

Texas 

County School Funds, 400-405 
Permanent School Funds, 11, 22, 115, 

130, 143-144, 159, 400-405 
school lands: no federal, 56; state, 

title to, 56, 84, 85, 400-405 
state taxes, reserved as School Fund, 
90 

Text-books, prescribed. Wash., 425; 
see also Books 

Theft of school funds. Mo., 323; see also 
Defalcation; Dishonesty; Embezzle- 
ment; Losses 

Thompson's Island, Mass., reserved for 
schools, 34 



492 



INDEX 



Timber lands denuded, 140-141; Wis., 

430, 431, 432 
Timber sales' proceeds added to princi- 
pal., Me., 91, 285, 291; Minn., 319; 

Mont., 91, 330; Utah, 407; Wash., 424 
Title to lands uncertain, Ala., 132, 211; 

La., 132, 281; Miss., 132, 326; Tenn., 

396; see also Ownership 
Titles of permanent funds changed, 

Del, 238; Fla., 243; N. H., 338; Ky., 

276 
Titles, official, of permanent common 

school funds, 7-18; Table II, 10; 

Table XVI, 98-106; see also under 

Funds 
Toll rates increase common school 

fund, Nev., 90, 336 
Townships for universities, 46, 47, 50 
Transportation, a lawful expenditure, 

Me., 293; Mass., 310; Mont., 331 
Treasurer, state, relation to manage- 
ment of School Fund: Col., 227; Del., 

240; Kan., 273; Me., 289, 294, 295; 

Mass., 308, 309; Minn., 319; Neb., 

333; Nev., 337; N. J., 344; Ore., 382; 

R. I., 388; S. C, 390; Tenn., 399; Vt., 

409, 415; W. Va., 428; Wis., 433; 

Wyo., 435 
Treasurer, township, manages funds: 

111., 257 
Treaty of Paris, land claims, 40 
Trent Grant, Ohio, 370 
Trespass moneys, increase principal: 

Mont., 330; Wash., 424 
Truancy laws, enforcement, 179; Mass., 

311; N. Y., 360 
Truant officer's salary, Mass., 310 
Trustees of permanent school funds, 

Vt., 417, 419; see also Boards 
Tuition defined, Ind., 266; N. Dak., 365 
Tuition: rates in 17th century, 25; paid 

from permanent funds, la., 270; Me., 

293; support schools, 300; see also 

Rate bills 
Tupper, Benjamin, and Ohio Company, 

45 
Turnpike lands, Ohio, 370 

United States, see also Congressional; 
Federal 

United States Bank Tax, 287 

United States Military Reservation, see 
Military lands imder Lands 

Unsold common school lands, area and 
value, Table VII, 20-21; unproduc- 
tive, la., 268 

Uses, lawful, of permanent common 
school funds, Table, XXI, 173-174; 



253, foot-note i22ff; Ala., 212; Ark., 
220; Cal., 225; Col., 227; Conn., 236; 
Del., 241; Fla., 245; Ga., 248; Id., 
252-253; Ind., 266; la., 270; Kan., 
274; Ky., 277; La., 282; Me., 292-293; 
Md., 298; Mass., 310; Mich., 315; 
Minn., 320; Miss., 328; Mo., 324; 
Mont., 331; Neb., 334; Nev., 337; 
N. H., 338, 341; N. J., 345; N. Y., 
354, 356, 357, 359; N. C, 362, 364; 
N. Dak., 366; Ohio, 377; Ore., 382; 
R. L, 388; S. C, 389, 390; S. Dak., 
393; Tenn., 399; Tex., 405; Utah, 407; 
Vt., 416, 419; Va., 422; Wash., 425; 
W. Va., 428; Wis., 433; Wyo., 436; 
classihed, 171-173; aims, 189 
Utah 

rate bills, 27 

State School Fund, 6, 406-407 

School land grant, 407 

Valuation as basis of apportionment, 
Mass., N. Y., 184-185, 186-188, 309, 

358-359 
Vandalia Railroad of Indiana, 264 
Vermont 

debts repudiated, 154 
funds for schools 

Common School Fund, 154, 159, 

409-410, 415 
Himtington Fund, 411, 412, 413, 

415, 417 
Permanent Public School Fund, 8, 
408-409, 413, 415, 416, 417, 418, 

419 
Spanish War Claims Fund, origin, 

79-80, 412-413, 416 
Surplus Revenue Fund, 73, 78 
United States Deposit Fund, 410, 
411, 413, 414, 415, 416, 418 
Maryland's resolutions endorsed, 55 
Rate bills, 27 

Special Commission, 169-170, 208 
Trustees of Permanent School Fund, 
417, 419 
Virginia 

funds for schools 

Colonial permanent school funds, 

.33, 34 

Literary Fimd, 148, 151, 159, 162, 
199, 420-421, 422, 427 

Surplus Revenue Fund, 72, 78 
land claims in northwest, 40-43 
lands devoted to schools, 421 
Mar>'land's- Resolutions endorsed, 55 
Mihtary Reservation, 43, 52, 369, 

370, 371,372, 373 
rate bills abolished, Table, 27 



INDEX 



493 



sale of western lands, 41 
Survey system in Military Reserva- 
tion, 371 
Visitation, see Inspection 

Wages, see Teachers' wages 

War claims and taxes devoted to per- 
manent school funds, Ky., Mass., 
S. C, Vt., 79-80, 89, 288, 30s, 416 

War effects on funds, see Civil War 

War loans interest, Ind., 297 

War supplies, transportation, 60 

Warrants, state, investments, Neb., 332 

Washington 

Common School Fund, 128, 182, 183, 

423-425 
constitutional provisions for school 

funds, 128, 424 
school lands, 128, 423-424 

Water and fuel, lawful expenditure. 
Miss., 328 

Weathersfield, Conn., rate bills, 1658, 28 

Wells, O. E., Supt. Wis., quoted, 149 

West Virginia 
free schools, 3 

Irreducible Fund, see School Fund 
School Fund, 12, 156, 159, 420, 421, 
426-428 

Western lands, see Lands, federal; 
Northwest Territory 



Western Reserve, see Conn., Western 

Reserve 
Wild lands. Me., 290; N. H., 84, 85, 

340-341 
Windsor, Conn., colonial school lands, 

Wisconsin 
free schools, 3 

Irreducible School Fund, see Wis., 

School Fund: cf. 429 
School Fund, 8, 113, 123, 139, 141, 
148-149, 151, 155-157, i59> 198, 
429-433 
school lands, 62, 62,, 139, 141, 429- 

433 
School Trust Fund, see Wis., 
School Fund, 429 
Wyoming 

Common School Permanent Fund, 6, 

22, 434-436 
sixteenth and thirty-sixth section 
lands, 434-435 
Wyoming Valley, land reservation, 36, 
229 

Year, school, see Term 

Zane's Grant, Ohio, 370 
Zulick, C. M., Gov., Ariz., on waste of 
school lands, 141 



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